Plug pulled on new electric tax credits
They’re omitted from spending bill approved by the House
WASHINGTON — The future of federal support for clean energy technology fell into question Tuesday, after the House passed a $1.4 trillion spending package without expanding tax credits for for electric vehicles, solar panels and energy storage.
After a dayslong negotiation, Democrats and Republicans agreed to a whittled down plan that included tax credit extensions for biodiesel and wind energy, but did not support many of the technologies scientists maintain are necessary to avoid the worst consequences of climate change.
“This deal will cost clean energy jobs throughout the country and stunt the growth of new industries everywhere from Arizona to Michigan, all while making our path to a 100 percent clean future that much harder,” said Christy Goldfuss, senior vice president for energy and environment policy at the liberal think tank Center for American Progress.
The spending deal, which President Donald Trump has indicated he will sign, comes after Democrats and Republicans debated how to pay for a long list of tax credits, ranging from Native
American coal plants to breweries.
But then “there was a breakthrough late in the night,” said Paul Winters, a spokesman for the trade group National Biodiesel Board.
According to draft legislation circulating Tuesday morning, the tax credit for biodiesel, which expired in 2017, would be extended through 2022, a boon for farmers and oil refineries. And the tax credit for wind turbines, which currently is winding down, will get extended for another year, giving projects begun before the end of 2020 a tax credit worth 40 per
cent of that awarded to existing turbines.
The deal also extends until the end of next year 26 additional tax credits that had expired in 2017 and 2018 , as laid out in bipartisan legislation introduced earlier this year.
Among those on the list were geothermal energy, electric scooters and motorcycles, coal plants owned by Native American tribes and energy efficient homes.
Energy lobbyists had spent months trying to get their respective industry’s tax credits expanded or extended, as Congress debated next year’s federal spending.
House Democrats had pushed to expand credits for electric cars, which currently are capped at 200,000 vehicles per manufacturer — a limit Tesla and General Motors already have hit.
At the same time, they were pushing to extend tax credits for wind and solar energy, both of which are scheduled to wind down in the years ahead, while creating a new tax credit for energy storage such as large-scale batteries.
“Congress let a crucial opportunity slip by, advancing a massive government spending bill without extending one of the most successful clean energy tax policies in history,” Solar Energy Industries Association President Abigail Hopper said.
Efforts to expand clean energy tax credits faced opposition from Republicans, including President Donald Trump, who has called for an end to the electric vehicle tax credit.
Within the Republican Party, there remains a general disdain for tax extenders, which are used to offer short-term tax relief to certain favored industries. Even though the bill didn’t expand or extend tax breaks for solar, electric vehicles and energy storage, it still was criticized by Rep. Kevin Brady, R-The Woodlands.
“Business as usual” won this round,” Brady tweeted Tuesday. “Fight isn’t over — yearly temp tax circus needs to end.”
While Congress largely opted not to increase direct government support for clean energy technologies, it did increase research funding at the Energy Department. The budget of Advanced Research Projects Agency — Energy was increased 16 percent to $425 million, and the Office of Energy Efficiency and Renewable Energy saw its budget increased 17 percent to $2.8 billion.
“With spending increases for @eeregov and @ARPAE but virtually nothing for tax provisions to expand clean energy, it shows that #cleanenergy is popular but not a priority for this Congress,” Heather Reams, executive director of Citizens for Responsible Energy Solutions, tweeted Tuesday.