by Abby Seadler Wednesday, May 16, 2012
It takes green to be green. Renewable energy technology requires dedicated investments, whether public or private, to succeed. The costs are steep, but many consider the cause worthwhile. After all, politicians on both sides tout having diverse array of energy resources as important for national and economic security. Nonetheless, in this tight economic climate, very little is safe. Now, Congress is starting to look at federal tax policies as they affect renewable energy development.
Last month, the House Science, Space, and Technology Subcommittees on Investigations & Oversight and Energy & Environment held a joint hearing to analyze the impacts of federal tax policies on commercial applications of American renewable technology. Since the 1970s, the primary tax incentives for renewable energy industries were the Production Tax Credit and the Investment Tax Credit, both of which provide tax breaks up to 30 percent for renewable energy endeavors such as solar energy property and fuel cells. Post-stimulus, President Barack Obama introduced the Advanced Energy Manufacturing Tax Credit and the 1603 program. According to Investigations & Oversight Subcommittee Chairman Paul Broun, R-Ga., these four programs combined add up to more than $43 billion in taxpayer dollars from 2011-2015. Tax incentives such as these, said Energy & Environment Subcommittee Chairman Andy Harris, R-Md., interfere with energy markets and drive up consumer costs. He and other subcommittee members looked to the natural gas industry as the model for a market and technology-driven clean energy industry.
Broun and others cited the “staggering” amount spent on renewables, coupled with the rising deficit and failed projects like Solyndra — the California-based solar panel manufacturer that was forced to declare bankruptcy last summer after having received more than $500 million in federal loan guarantees — as further exacerbating American impatience with the renewable energy sector. Ultimately both of the subcommittees, voiced by Rep. Broun, concluded that the goal should be to ensure an efficient “all of the above” strategy that respects market decision and does not contribute to the deficit.
For more information on the complexities of this issue please visit http://science.house.gov/hearing/subcommittee-investigation-and-oversight-subcommittee-energy-and-environment-%E2%80%93-joint-hearing.
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