Cancun! Wait! Democrats Get a Climate and Clean Energy Bill! (in Return for Baubles for the Rich)

Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!

The first two of the energy provisions from the Baucus Amendment are the biggest deal. Section 1603 30% cash for renewable projects, and R&D tax credits for clean energy manufacturing (like making wind turbines). The first is now in Monday’s bill, thanks to the efforts of 30-some Democratic Senators led by Senators Boxer, Cantwell, Udall and Feinstein. The second, sadly, is still iffy, despite the clear need to retool the rust belt to make a clean energy supply chain.

An unprecedented $16 billion investment in US solar and wind (two thirds private) was made possible by Section 1603 in just the eighteen months since The Recovery Act began it. But, with an expected end to the great recession by now, it was set to expire at the end of 2010.

The Treasury grant program approved about 1,500 awards of more than $5.5 billion in payments, mostly for wind and solar projects – and also included some waste biomass projects, such as capturing and making electricity from landfill and agricultural sources of methane.

Baucus Amendment now would extend for two years:

#1. Section 1603 Extended. Payment in lieu of production and investment credits. The bill codifies the direct payment in lieu of tax credit program that was initially created by Section 1603 of the American Recovery and Reinvestment Act, and extends the program through December 31, 2011.

#2. Domestic R&D energy manufacturing. The bill provides an additional $2.5 billion in funding for the Section 48C advanced manufacturing tax credit. Section 48C was established in the American Recovery and Reinvestment Act to provide a 30% investment tax credit for facilities engaged in the manufacture of advanced energy property. Credits are available only for projects certified by the Secretary of Treasury, in consultation with the Secretary of Energy, through a competitive bidding process.

Credit for electricity produced at certain open-loop biomass facilities. The bill extends the credit period under the production tax credit for electricity produced at open-loop biomass facilities that were placed in service prior to January 1, 2005 from five years to seven years. The credit is reduced in 20 percent increments starting in the sixth year.

Extension of special rule for sales of electric transmission property. The bill extends for two years (for sales prior to January 1, 2012) the present law deferral of gain on sales of transmission property by vertically integrated electric utilities to FERC-approved independent transmission companies. Rather than recognizing the full amount of gain in the year of sale, this proposal allows gain on such sales to be recognized ratably over an eight-year period.

Natural gas vehicles and heavy hybrid vehicles. The bill extends through 2011 tax credits for heavy hybrid vehicles (those above 8,500 pounds) and natural gas vehicles.

Alternative vehicle refueling property. The bill extends the 30% investment tax credit for alternative vehicle refueling property for one year, through 2011. The bill also clarifies eligibility for this credit regarding electric vehicle refueling pump property.

Energy-efficient existing homes. The bill extends through December 31, 2011 the period in which the section 25C tax credit (30% credit, $1500 maximum) for energy-efficient property in existing homes, as modified by the American Recovery and Reinvestment Act, can be claimed. Effective January 1, 2010, the bill also links eligibility for windows purchased with the tax credit to Energy Star requirements, which account for different climate regions in the United States.

Energy-efficient appliances. The bill extends through 2011 and modifies standards for the credit for US-based manufacturing of energy-efficient clothes washers, dishwashers and refrigerators. For appliances manufactured in 2009 and 2010, taxpayers may elect to receive the credit as a direct payment. The direct payment would be equal to eighty-five percent (85%) of the tax credit that would otherwise have been allowed.
Natural gas distribution lines treated at 15-year property. Under current law, gas distribution lines can be depreciated over 15 years. Starting January 1, 2011 the depreciation period is 20 years. The bill extends the 15-year period for one year.

Extension of energy-efficient new homes credit. The bill extends the tax credit for manufacturers of energy-efficient residential homes through 2011.

It will also continue widely unpopular previous ethanol provisions that get bipartisan support from farm state Senators on both sides of the aisle – and nobody else.

This is not the excellent well-crafted Waxman-Markey stand-alone cap and trade bill that would pay for itself (per the CBO). It s not the mirror cap and trade Senate bill Senator Boxer passed out of committee despite a walkout by all the Republicans, that would (per the CBO) save $21 billion.

The fossil industry successfully maligned those climate bills that solved how to pay for clean energy by making polluters pay (with cap and trade). They sold the right, and the left.

So, by contrast, rather than polluters paying, it is the American people who will have to pay (Rush Limbaugh) for this bill. But, it is a major renewable energy bill.

Image: Times of fun
Susan Kraemer@Twitter


Have a tip for CleanTechnica? Want to advertise? Want to suggest a guest for our CleanTech Talk podcast? Contact us here.

Latest CleanTechnica TV Video


Advertisement
 
CleanTechnica uses affiliate links. See our policy here.