Incentivizing energy efficiency needs to be part of any tax reform proposal, says the National Electrical Manufacturers Association (NEMA).

Senate Finance Committee Chairman Max Baucus (D-Mont.) has proposed energy tax reform that would eliminate incentives currently targeted to energy efficiency. The reformed policy would be technology neutral and be weighted toward emissions reductions.

The current set of energy tax incentives is overly complex, most participants agree. NEMA has proposed a simple, effective, and technology-neutral package of tax incentives for energy efficiency in buildings, factories, and the electric grid.

Greater energy efficiency in all our sectors will boost economic productivity and competitiveness, enhance U.S. energy security, mitigate outages, and reduce emissions. Energy efficiency is clean, green, and resilient, and should be promoted as a key policy goal in the tax code, NEMA says.