Solar tax credit renewals get green light from Senate
Hopes for renewable energy may not be a pipe dream after all.
After nearly a year of squabbling, the U.S. Senate voted Tuesday to extend solar tax credits for the next eight years and also remove the $2,000 cap on residential projects.
(Credit: CNET News)What with all the political bickering, I was betting this wouldn't ever get done before the November elections. But the hired help in Washington provided a pleasant surprise for a change. The bill, which includes an allowance for utilities to make use of the commercial credit, now goes to the House of Representatives for approval before everyone clears out of town next week. The current tax credit was set to expire at year's end.
Doubtless there will be some ready to dun the agreement as yet another handout to an interest group. On the surface, that's true. But after the government's recent series of bailouts including--drum roll, please--Bear Stearns, Freddie Mac, Fannie Mae, AIG, and the $700 billion or so the Treasury Department wants to buy illiquid mortgage-linked securities--this one should mollify the critics, according to Barry Cinnamon, CEO of Akeena Solar.
"I don't think anybody is going to look at $17 billion over 10 years going to renewable energy as a handout when you put it in the perspective of $1 trillion going to failed banks in a one-year period," said Cinnamon. He added that while he did hear the handout argument a couple of years ago, he's not encountering that line of argument, what with crude oil prices hovering north of $100 a barrel.
Cinnamon and other solar industry executives have argued that the industry is still too young and too fragile to be weaned off the investment tax credit (ITC) just yet. Solar energy lobbyists released a study by Navigant Consulting claiming that 440,000 permanent jobs and $232 billion in investment would be supported by 2016 with an eight-year extension of the ITC.
However, that argument wasn't persuading enough Senators to pledge their support to the investment tax extension. In fact, when Congress passed the 2007 energy bill, the solar industry got shut out. The ongoing debate had a lot to do with accounting. While Democrats wanted to pay for them by taking away tax credits from the oil industry, the Republicans held firm.
A couple of recent developments helped break the logjam. One was the willingness of congressional Democrats to go along with an offshore-drilling proposal. The other was a statement from the White House that it would not oppose extending the tax credits.
"The great thing about this bill is that it's going to allow people throughout the country to benefit," said Cinnamon. "It will be as much for people in Peoria as it will be for people living in Pleasanton."
Charles is an executive editor with CNET News. He has covered technology and business for more than 25 years. A graduate of Queens College and Columbia University, Cooper began his career in journalism at the Associated Press before moving to technology coverage. Before joining CNET News, he worked at Computer & Software News, Computer Shopper, PC Week, and ZDNet. He received the Excellence in Journalism award from the Northern California branch of the Society for Professional Journalists for column writing. In addition to his blogging and podcast appearances, he is a co-host of the CNET News Daily Debrief. E-mail Charlie.
- Topics:
-
Technology,
-
Business currents
- Tags:
-
Renewable energy,
-
solar,
-
Barry Cinammon
- Bookmark:
- Digg
- Del.icio.us
@ The author: Cool beans :)
As for the article, if the solar industry has to have special tax breaks in order to be viable, then the industry is not worth it. If it can't work on its own without government handouts, then shouldn't that tell you that the industry is not worth it? Successful people / industries are successful because they bring a product that is wanted and / or needed. If there is so much incentive and need to have everything go "green", then why can't the solar industry survive on its own like most every other industry?
I guess they can't afford to look for oil without taxpayer help.
As for "Big Oil", think about it. Everyone complains they make too much money. My mutual fund and most every pension plan invests in these companies. Their money is going to help me retire since the government is stealing my social security money for other pet projects. As to handouts for the oil industry, Exxon paid $32.36 BILLION in taxes for 2007. That is $32,360,000,000. That is just one company and does not include the federal gas tax we all pay. Now you tell me if they are getting the handouts or is it the government?
The big hurdle for years has been cheap oil. Now that Oil sells for at or around triple-digits per-barrel, it makes financial sense to get some Solar (or wind, or etc.) energy going. Before now, only hydro in limited circumstances was worth the costs - and even then only with huge initial gov't investments. Now it is just as cheap to install solar panels or wind turbines.
The market is pretty much taking care of itself in that way.
That said, the tax credits aren't handouts - tax credits are incentives (and tax cuts generally stimulate economic growth - which is why both parties are advertising them to the rafters this year, no?)
PS: The very first conservationist president (Theodore Roosevelt) was a Republican. ;) Nowadays, both parties will loudly proclaim to "care", but BOTH parties are instead interested in only two things: Power, and Wealth.
It's that kind of thinking that got us $9 trillion in debt. Every program and project costs a minimum of $1 billion. Doing a study about a study costs $1 billion. Oh, it's not REAL money. It's just debt.
The real solution would be to implement the FairTax. There would be none of these types of bail-outs or unequal incentives. Our economy would boom like nothing before if the FairTax was passed.