Top Dem tax writers differ on clean energy breaks
Lindsey McPherson and Benjamin J. Hulac
The chairmen of the House and Senate tax-writing committees plan to prioritize incentives for lowand zero-carbon energy sources as Congress works on a second major economic package this year. But they differ on whether to throw out the existing patchwork of tax breaks or expand on it.
Senate Finance Chair Ron Wyden, R-Ore., is renewing his push to consolidate 44 energy-related tax incentives into just three that scale up or down based on reduced emissions or energy usage. House Ways and Means Chair Richard E. Neal, DMass., on the other hand, is backing a plan to renew and expand dozens of existing policies while creating some new tax breaks as well.
Wyden’s plan would establish one credit for production of electricity or investment in facilities producing lower emissions than the national average, increasing in value with a maximum credit applied to zero-carbon electricity sources. Another is a credit for cleaner transportation fuels, with an expanded credit for electric vehicle purchases, and the last would incentivize energy efficient homes and buildings.
Wyden told CQ Roll Call last week many of the existing incentives are “just kind of monuments to yesteryear, really outdated provisions.”
He said he’s lobbying both Democrats and Republicans and pitching his plan as a more cost-effective climate solution. “This is a chance to get more green energy for less green from everybody’s wallet,” Wyden said.
The Oregon Democrat said he wants to use the budget reconciliation process again to pass his plan, similar to what his party used to enact the massive $1.86 trillion coronavirus relief law President Joe Biden signed on Thursday. He thinks infrastructure could be part of another reconciliation package too, but he said he doesn’t want to “front run” other senators on that question.
Infrastructure falls under the jurisdiction over multiple Senate panels, but Finance has sole jurisdiction over the tax code.
“I would like to, as part of this transition to the clean energy manufacturing sector, (incentivize) high-skill, high-wage jobs, which is pretty much what the president campaigned conceptually on in the fall, and this is a real bill that would put it into motion,” Wyden said. “And (Biden) obviously wants clean energy in this package too.”