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Contact Jim: jdipeso@rep.org (253) 740-2066 / 2009 Archive / 2008 Archive / 2007 Archive / 2006 Archive / 2005 Archive
Renewables Back from the Precipice
October 3, 2008
Don't blame people in the renewable energy industries if they seem a tad on edge these days.
Extension of expiring tax credits for renewables have been left for dead in the halls of Congress more times in the past two years than they care to count.
Final congressional passage today of tax credit extensions in the slipstream of the mammoth financial rescue package pulled the credits back from the precipice – only days after the end seemed to be at hand when the House and Senate could not agree on tax cut offsets.
The tax incentives – a per-kilowatt-hour production credit for wind, geothermal and other renewables, and an investment credit for solar energy – were due to expire at the end of this year.
If the credits had expired, a cascade of unfortunate consequences would have followed. The air would have been let out of wind and solar projects that are counting on the credits to pencil out. Nearly $20 billion in investments would have been lost entirely, according to a report published earlier this year by Navigant Consulting.
One of those possible casualties would have been a mega solar thermal project in Arizona. Hardly a boutique project, the 280-megawatt plant would be about one-third the size of a utility-scale coal plant.
It was a close call, but next year Congress will have to renew the credit again for wind, which only received a one-year extension. The sooner that Congress figures out a sensible strategy for adopting long-term credit extensions, the faster that wind can gear up for a long-term expansion adding carbon-free power to the grid.
It's time for an end to the Capitol Hill roller-coaster rides that needlessly impede rewiring of America's energy economy.
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