Democrats push to extend clean energy tax credits as deadline looms
Credit: Fox News | December 17, 2013 | www.foxnews.com ~~
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A group of Senate Democrats is calling on Senate Finance Committee leaders to renew clean energy tax incentives set to expire at the end of the year, setting the stage for a possible showdown with conservative lawmakers who are opposed to some of the costly subsidies.
The tax credits, which range from renewable energy production subsidies to incentivizing cleaner vehicles, have track record of creating jobs and greenhouse gas emissions, Sen. Ed Markey, D-Mass., said in a letter signed by 23 of his Senate colleagues.
“These tax credits have helped scale up production and drive down the cost of clean energy technologies. They remain critical to addressing the market failures that prevent cost-effective, market-ready technologies from being deployed to their full potential,” Markey wrote.
The credits include a tax credit for the wind energy industry that drove $25 billion in private investment and supported the installation of more than 13,000 megawatts of new production capacity, according to the Senate group.
Last month, more than 50 lawmakers urged House Ways and Means Committee Chairman Dave Camp to let the wind energy credit expire on Dec. 31, arguing that the subsidy “is now more valuable than the price of the electricity the plants actually generate.”
“The growth in wind is driven not by market demand, but by a combination of state renewable portfolio standards and a tax credit that is now more valuable than the price of the electricity the plants actually generate,” the bipartisan group of House members said in a letter to Camp.
The tax credit, established by the Energy Policy Act of 1992, was originally worth 1.5 cents per kilowatt-hour of electricity produced. Today, the rate is worth 2.3 cents per kilowatt hour would cost $6 billion for a one-year extension, according to the Joint Committee on Taxation.
The Institute for Energy Research recently released a study disputed by the wind energy industry that called the program “terribly inequitable.” The study found that states which aren’t industry hubs and don’t receive much from the tax credit pool “unfairly shoulder the burden.”
According to the group of Democratic senators, allowing the credit for wind production to expire would threaten more than 80,000 jobs across nearly every state.
A bipartisan group of state governors also recently wrote a letter to Congressional leaders asking them to renew the credit. They argued that uncertainty over the credit’s renewal last year has cost the industry investments and jobs.
“The nation’s wind industry developers do not need this tax credit forever, but they do need policy certainty in the near term to bring their costs to a fully competitive level,” the letter said.
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