Extension of an $858-billion tax credit package, including the suite of renewable energy tax cuts and grants outlined in Department of Treasury Section 1603 tax grant program, could happen as soon as today as the House of Representatives gets its hands on the Senate’s bill which passed on Dec. 15.
Renewable energy industry insiders consider US Tax Grant Program (TGP) 1603, which subsidizes about 30% of the new facility costs for renewable energy projects, the most powerful force behind 2010 growth: “Since its passage, the 1603 program has successfully created jobs and opportunity in all 50 states for construction workers, electricians, plumbers, contractors that have struggled during this difficult economic climate. An extension will help the solar industry remain one of the fastest growing industries in America,” said Rhone Resch the CEO of the Solar Energy Industries Association (SEIA) in a statement.
According to SEIA’s web site, the TGP triggered more than 1,100 solar projects in 42 states and supported $18 billion in investment, allowing the solar industry to grow by more than 100 percent in 2010, create enough new solar capacity to power 200,000 homes, and provide jobs for 93,000 Americans.
Denise Bode, the CEO of the American Wind Energy Association (AWEA), said in a statement that the tax breaks are important to long-term growth to wind, too: “With consistent policies like this one, wind energy can generate 20 percent of America’s electricity within 20 years, and employ half a million Americans.”
The bill includes a provision to revive the $1/gal biodiesel tax credit, which expired in 2009, but would take effect retroactively from the start of 2010 and last through 2011.
It also resurrects a $0.50/gal tax credit for companies using liquefied natural gas, liquefied coal and other alternative fuels
Ethanol would maintain its own sweet breaks, $0.45/gal credit for blenders to add ethanol to their gasoline mixes, and a $0.54/gal tariff on imported ethanol. Sen. Dianne Feinstein (D-Calif.), said in a statement following the Senate vote, that she would seek to reduce ethanol credits when the new Congress convenes in January.
“The ethanol industry is the only one to ever receive the triple crown of government intervention. Ethanol use is mandated by law, its users receive federal subsidizes and domestic production is protected by tariffs. That policy is not sustainable,” Feinstein said.