Senate Passes Renewable Energy Tax Credits. Why Am I Not More Excited?

By an impressive tally of 88-8, the Senate approved The Clean Energy Tax Stimulus Act (S.2821) as an amendment to HR.3221, which aims to mitigate the economic impact of the current housing crisis.

The renewable energy tax credits were slipped into a housing bill that that did not end up looking the way its lead author, Sen. Chris Dodd really intended it to, remarking earlier in the week that it was “a housing bill, not a Christmas tree.”

However, will the production tax credit and investment tax credit ever make it to the President’s desk to sign?

Despite the optimism shown by some well respected voices in the green blogosphere, I would argue that we will see some sort of stripped-down version of the renewable energy tax credits, if any at all. The House has hardened its opposition to this version of the tax-credit extensions, which are estimated to cost $6 billion over 10 years. House leaders have strong objections to deficit-financed tax breaks, and with few exceptions, they have offset lost tax revenue with tax increases or spending cuts elsewhere. But since the President rebuked Congress’ previous attempts at funding the tax credits by rescinding tax breaks for big oil, there hasn’t been much of a discussion as far as where the money for this program will come from.

“I doubt that the House will accept these extensions without some corresponding offsets,” said Senate Energy and Natural Resources Committee Chairman Jeff Bingaman (D-NM) on the Senate floor. “This leaves the administration with a key role to play in developing a compromise that will be acceptable to both chambers.”

So we’re leaving this up to the administration to figure out? Yikes.

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