Tax Credits for Renewable Energy and Energy Efficiency Renewed
One of the last acts of the 110th Congress was renewing the critical investment and production tax credits for renewable energy and energy efficiency, which were set to expire on December 31, 2008. Thanks to the efforts of a diverse coalition that included the Union of Concerened Scientists, the credits were extended as part of the Emergency Economic Stabilization Act of 2008 that President George Bush signed on October 3, 2008.
Under the new law:
- The energy efficiency tax credits are available to:
- People who buy efficient appliances and houses;
- People who make energy efficiency upgrades to their homes; and
- Manufacturers of energy-efficient appliances.
- The solar investment tax credit gives individuals and companies a tax credit for their purchases of solar panels or solar water heaters (for residential systems, the credit is capped at 30 percent of the system cost).
- The renewable energy production tax credit is available to generators of wind, geothermal, or biomass energy for the clean, renewable energy they produce.
- The production tax credit is expanded to include energy produced from wave and tidal systems.
UCS worked with a large, diverse coalition of businesses and environmental groups to extend the tax credits. Hundreds of UCS activists called their senators and representatives, urging them to support extending the credits, which aid growth in a wide range of renewable electricity, renewable fuels, and energy efficiency sectors.
Our work isn't finished, however. The recession of 2008 has undermined the effectiveness of the credits. A firm that has little or no income can derive little or no benefit from the tax credits. So, in 2009, UCS, our allies, and renewable energy developers will be working to revise the credits to make them refundable. Refundable credits will ensure that renewable energy development will continue even when the economy slows--the very time sustained growth in renewable energy is needed most to create jobs and income.
