Renewable Energy Tax Incentives for Electricity and Fuel Production to be Revised
The Senate Finance Committee has released a draft proposal that outlines an overhaul of energy tax incentives. The proposal would consolidate 42 different current incentives into two targeted ones, for the domestic production of clean energy and of transportation fuel. A tax credit for clean electricity would link the size of the tax credit to the level of cleanness. It would be open to all resources, renewable and fossil. The tax credit for the production of clean transportation fuel would operate similarly; it would apply to fuel that is 25 percent cleaner than conventional gasoline. Under the proposal, the two credits would phase out once the greenhouse gas intensity of each market has declined by 25 percent. This potential policy shift bears close scrutiny since it would provide major benefits for the renewable energy investment markets.
John Howell, Editorial Director