Filed under: Policy
At noon Eastern time, the Associated Press reports that the impasse between the House and Senate on tax credit extensions — and on fixing the alternative minimum tax — will not be resolved before the House adjourns today.
If so, no action will be taken on extending the renewable tax credits until after the election, and possibly not until the new congress convenes in January.
Filed under: Policy
Sunday-night news items in The New York Times and CQ Politics reported that the House of Representatives will make one more late effort to deal with the renewable energy tax credit extensions passed by the Senate last Tuesday.
But House leaders held out little hope that a compromise would emerge. House Democrats insist that tax credits be offset with “new” funds derived from repealing tax credits for oil companies. To Senate Republicans, that would be a tax increase on the oil giants, and they won’t agree to the provision. The result: a year of stand-offs and another likely failure to extend the credits. The Times ran an editorial urging that the showdown be resolved.
Renewable energy isn’t the only issue stuck in this morass. A fix for the alternative minimum tax, to provide middle-class tax relief, is also at risk and apparently doomed in this session.
The House will adjourn on Monday after voting on the Wall Street bailout plan — which, by the way, is NOT paid for by offsetting revenues.
Congress will have to revisit the renewable energy credit extensions in lame duck session in November.
Filed under: Policy
In the midst of its hurried negotiations of a proposed Wall Street bail-out, the House and Senate found time this week to approve separate energy bills extending the renewable energy tax credits beyond the end of this year.
The Senate bill, which passed by a 93-2 vote on Tuesday, was a broad tax measure that extends most renewable energy incentives by eight years, and the White House said it would approve the measure.
The House bill, which passed by 257-166 today, is a narrower energy-only measure that pays for renewable energy incentives through reduced tax credits for oil companies. The White House threatened to veto it.
No agreement between the House and Senate had emerged by the close of the session today, when Congress was scheduled to adjourn for the election campaign. But there were hints that Congress might remain in session to deal with Wall Street’s credit crisis. If so, there’s some chance a unified energy bill might emerge before the election.
Otherwise, Congress will try to reconcile the energy incentives when it convenes in lame-duck session after the election.
The House and Senate bills differ on several important issues. The House bill pays for its renewable incentives by eliminating $18 billion in tax incentives for the oil business. White House officials say the president considers this measure a tax increase worthy of veto.
The Senate’s Energy Improvement and Extension Act merely freezes those oil industry incentives. Both versions of the bill continue the 30 percent tax credit for residential and business solar systems, and remove the $2,000 cap on that credit.
Filed under: Policy
The House today passed its own version of the energy tax credit extensions, with sufficient changes that the bill will need to be reconciled with the Senate version. The vote was 226 to 166.
The House version contains pay-for provisions which have been interpreted by the White House as tax increases on oil companies. If the final bill contains this language, White House staff say the president may veto it.
Now we wait to see if the Senate and House can negotiate a compromise bill, today. Otherwise, we’ll revisit the whole issue in November.
See coverage by Bloomberg and Reuters.
Filed under: Policy
The House of Representatives today suspended debate and postponed until Friday a vote on H.R. 7060, the tax extenders bill containing extension of the tax credits for renewable energy and energy efficiency that will otherwise expire in on Dec. 31.
H.R. 7060 is the House Democratic leadership revision of H.R. 6049 – amended and approved by the Senate on Tuesday by a vote of 92-3.
The change in schedule was necessitated because of a discrepancy between the text of the bill that was approved by the rules committee and the text of the bill that was brought to debate before the House.
At a bell-ringing ceremony held today at the New York Mercantile Exchange in lower Manhattan, the Regional Greenhouse Gas Initiative (RGGI) marked the opening of the first-in-the-nation auction for carbon dioxide emission allowances. Participating states are Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island and Vermont.
RGGI will reduce carbon dioxide (CO2) emissions through a mandatory, market-based cap-and-trade program. Under RGGI, the ten participating states will stabilize power sector carbon emissions at their capped level, and then reduce the cap by 10 percent at a rate of 2.5 percent each year between 2015 and 2018. Participating states plan to have implementing regulations in place by January 1, 2009.
Revenues from the auctions will be invested in energy efficiency programs, renewable energy stimulus efforts and other programs to benefit consumers. As a result, RGGI will deliver economic and environmental benefits and improve energy security through reduced use of fossil fuels.
The RGGI auction held today offered 12,565,387 allowances, including CO2 allowances issued by Connecticut, Maine, Maryland, Massachusetts, Rhode Island and Vermont. The CO2 allowances purchased at this auction can be used by a regulated facility for compliance in any of the RGGI states, even if that state did not offer allowances in this auction.
Other RGGI participating states will offer allowances for sale in future auctions as they complete their necessary rulemaking proceedings. A second auction is scheduled for December 2008, with all RGGI participating states expected to offer allowances for sale in the first 2009 auction. Future sales of CO2 allowances are planned through a steady offering of allowances in quarterly auctions. States have committed to offer for sale before the end of 2011 all of the allowances they are putting into the auctions for the first three-year compliance period. Regulated power companies must hold enough allowances to match their CO2 emissions for the first compliance period by March 1, 2012.
Seven western U.S. states and several Canadian provinces have embarked on the Western Climate Initiative, a cap-and-trade system to be implemented by 2012. Florida is also studying a cap-and-trade system, as are several Midwest states. The European Union has recently indicated it wants member nations to shift the European carbon cap-and-trade program to an auction-based format.
Filed under: Policy
The U.S. House of Representatives on Wednesday approved some of the tax breaks passed by the Senate on Tuesday — but split out renewable energy tax credit extensions for consideration in a separate bill, not yet put up for a vote.
Ways and Means Committee Chairman Charles Rangel (D-NY) continued to call for budget offsets to pay for renewable energy tax credit extensions.
Here’s a report from Reuters in which renewable energy issues are conspicuous by their absence.
Filed under: Investing
Solar and wind energy companies boomed along nicely in 2006 and 2007, with sales up, on average, over 40%. Then, as prospects for renewal of the federal renewable energy tax credits began to fade (the Senate rejected them eight times), stock prices for these companies began to sag. Sales were brisk, because customers wanted their projects finished by the Dec. 31 cut-off date for tax incentives, but all companies laid plans for cut-backs after the end of the year.
Now, with passage of the new tax credit bill by the Senate on Tuesday afternoon, renewable energy stocks have shown a surge — exactly the opposite of what’s going on in other stock sectors. A short blog item on today’s Wall Street Journal website summarizes the morning’s action.
Filed under: Policy
Reuters reports that the U.S. Senate this afternoon approved a one-year extension of wind energy tax incentives, with a two-year extension for other forms of renewable power and an eight-year extension for residential solar.
The Associated Press reports the margin of victory was 93 to 2 — ironic considering how long this bill was stalled.
The House will now respond on Wednesday with its own bill, presumably containing the same language. The White House said it opposes the “tax hike” elements of the bill, but that the President will sign it.
Bloomberg’s Daniel Whitten offers a good analysis of what’s in the bill — including the plum concessions to oil companies that brought conservative senators over. One item he didn’t mention: Democrats caved on the offshore drilling issue. The New York Times reports that, faced with a veto threat on the drilling moratorium, they’ll allow the ban to expire at the close of the year. Is this part of the horse trading? We may find out in time.
The extension of renewable incentives is great news, coming as it does at the last possible minute, with just three days left in this legislative session. In the long run it will lead to nearly a million new jobs in wind, solar and other renewable projects. Warm congratulations are due to all who worked so hard to bring this measure to a vote.
Now let’s see what the House does.
Filed under: Policy
Reports surfaced on the web last week that renewable energy tax credits had gotten lost in the shuffle as Congress turned itself inside out on the Wall Street bail-out. Action would be delayed at least until after the election, the reports said.
Maybe not. Wire services reported on Friday that the Senate may vote on Tuesday (or Thursday, depending on whose reporting you read) on its own energy bill. That bill would extend renewable energy tax credits by eight years, but in a compromise to Republicans, apparently won’t pay for them by ending oil industry tax credits, as the House bill does.
We’ll see what happens.
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