Over two-dozen Senate Democrats are trying to create 11th-hour political momentum for extending a grant program that supporters say has provided a lifeline to renewable power developers during the economic downturn.
In a letter Monday to Senate Democratic and GOP leaders, the lawmakers tout the benefits of the expiring Treasury Department grant program that was created in the 2009 stimulus law, and warn that renewable energy project financing will dry up without its extension.
The program allows developers to access grants for projects such as wind farms in lieu of traditional tax credit financing, which became less attractive when the economy tanked.
Sens. Maria Cantwell (D-Wash.), Dianne Feinstein (D-Calif.) and 24 other Democrats are asking for a two-year extension of the program – which sunsets at year’s end – in “any tax package the Senate considers during the current lame-duck session.”
Sen. George LeMieux (R-Fla.) joined 26 Democrats on the letter.
The letter notes the grants have been “widely credited with maintaining strong growth in the renewable energy sector in 2009 and 2010, despite the severe economic downturn” and helped create jobs.
“Prior to the economic meltdown, clean energy project developers relied on ‘tax equity partnerships’ with investors to take advantage of clean energy tax incentives. In 2008, the economic meltdown froze the $8 billion tax equity market, jeopardizing billions of dollars in clean energy investment. The TGP [Treasury Grant Program] proved an effective replacement for these partnerships, supporting around $18.2 billion in clean energy investment to build 8,600 megawatts of renewable energy generation through October 25, 2010,” states the letter to Senate Majority Leader Harry Reid (D-Nev.), Minority Leader Mitch McConnell (R-Ky.) and the leaders of the Senate Finance Committee.
“With most utilities and developers still unable to utilize existing production and investment tax credits, and our nation’s economic recovery dependent on the creation of new jobs, we believe a two-year extension of the TGP is critical,” adds the letter, which is signed by senators including Ben Nelson (D-Neb.), Kent Conrad (D-N.D.), John Kerry (D-Mass.), Debbie Stabenow (D-Mich.) and others.
“We believe that any tax package should be designed to stimulate economic growth and job creation, and should include an extension of the Treasury Grant Program with an appropriate offset,” the letter states.