On May 21st, the Renewable Energy and Job Creation Act of 2008 was passed by the House of Representatives (253-160). This act extends a number of tax incentives for renewable energy, carbon capture and sequestration demonstration projects, energy efficiency and conservation measures. Which all sounds really neat and cool. I want to bring forward a few examples from the bill and discuss a larger point or two.
Extends through 2009 the tax credit for producing electricity from wind facilities and through 2011 for closed and open-loop biomass, geothermal, small irrigation, hydropower, landfill gas, and trash combustion facilities. Includes marine and hydrokinetic renewable energy as a renewable resource for purposes of such tax credit.
Extends through 2018 the temporary increase in coal excise taxes.
Extends through 2013 the tax deduction for energy efficient commercial building expenditures.
So coal excise taxes are those placed on coal exports from coal producers. I don’t know much more about them than that, but on the surface it sounds alright.
But the main point I wanted to raise was the length of time each item has been extended. The difference between the wind facility extension and the coal excise tax extension is 9 years. That generates a great deal of uncertainty for wind facility development, which is a growing and important part of both Colorado’s and the U.S.’s economies. Will the tax credit continue to be extended? It depends greatly on who’s running Congress and who the President is next year, doesn’t it? I would really like to see a great deal more stability delivered to renewable energy development assistance.
Look at the commercial building energy efficiency tax deduction. It’s valid through 2013, 5.5 years from now, if this bill is signed into law. That’s a large dose of stability for commercial developers. The 2011 date for closed and open facility tax credits is more than the wind facility credit, but still two years shorter than commercial building energy efficiency. Those open and closed loop systems, especially the closed loop versions, deserve more assistance than I think this bill provides. That’s not to say the bill is bad, I just think it could be a little bit better. Of course, I don’t know the kind of deal-making that had to occur to get it passed through the House, either.
For that matter, I don’t think it’s been to the Senate yet. Who knows what changes they’ll make to it. And lastly, will President Bush sign it? I assume there’s enough fossil fuel tax credits included for him to hold his nose while continuing tax credits for renewable energy.