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- 2005-11-19
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April 28, 2006
Washington, DC, USA: Federal Bill Introduced to Extend Solar Energy Tax Credits
With electricity and gas prices skyrocketing across the country, 32 members of Congress responded
this week by introducing legislation in the House and Senate to extend solar energy and fuel cell
investment tax credits for homeowners and businesses through 2015. The credits are currently set
to expire next year.
The Solar Energy Industries Association praised Senators Gordon Smith(R-OR) and
Robert Menendez (D-NJ), as well as Reps. J.D. Hayworth (R-AZ) and Michael McNulty (D-NY),
for sponsoring S. 2677
and H.R. 5206, the “Securing America’s Energy Independence Act.”
"Solar power is clean, renewable and cost effective, but it also needs time to develop," said Rep.
Hayworth. "New technologies such as solar systems or hybrid cars aren't created overnight.
By extending these tax credits we are giving this industry time to grow, branch out and succeed."
Initial co-sponsors in the House included Reps. Dave Camp (R-MI), Michael Fitzpatrick (R-PA), G.K.
Butterfield (D-NC), Sherrod Brown (D-OH), Rob Simmons (R-CT), Daniel Lipinski (D-IL), Mark Udall
(D-CO), Spencer Bachus (R-AL), Vern Ehlers (R-MI), Thadeus McCotter (R-MI), Maurice Hinchey
(D-NY), John Sweeney (R-NY), Mike Rogers (R-MI), Charles Dent (R-PA), John Doolittle (R-CA),
Frank Wolf (R-VA), Roscoe Bartlett (R-MD), Ben Cardin (D-MD), Mary Bono (R-CA), Zach Wamp
(R-TN), and Michael Ferguson (R-NJ). The legislation builds on a stand-alone solar extension bill Rep.
Ferguson had introduced in 2005.Initial cosponsors in the Senate included Senators
Joseph Lieberman (D-CT), Olympia Snowe (R-ME), James Jeffords (I-VT), John Kerry (D-MA),
Maria Cantwell (D-WA), Ken Salazar (D-CO), and Hillary Clinton (D-NY).
“As we head into the summer with the highest energy prices on record, these congressional
leaders have introduced a responsible, forward-thinking bill to help provide relief for the consumer,”
said Rhone Resch, SEIA president. “Now is the time for Congress to embrace sustainable energy
solutions that can lower our energy bills immediately and in the future.”
The Energy Policy Act of 2005 provided a 30% tax credit for solar systems
purchased for both residential and business applications. However, these credits will expire after
two years without legislative remedy, a term too short to encourage significant industry growth.
A long-term extension is essential to reducing the cost of solar energy, as it would create market
conditions that allow solar companies to make investments and drive down costs through
economies of scale.
The Senate and House bills both include the following provisions:
Residential Solar Tax Credit: Extends a 30-percent tax credit, created in the
Energy Policy Act of 2005, for the purchase of residential solar water heating, photovoltaic
equipment, and fuel cell property. Changes the maximum credit to $2,000 for each kilowatt of
capacity for solar equipment and $1,000 for each kilowatt of capacity for fuel cells. Credits may be
taken against the alternative minimum tax. Expires after December 31, 2015.
Business Solar Tax Credit and Fuel Cell Tax Credit: Extends a 30-percent business credit, established
in the Energy Policy Act of 2005, for the purchase of fuel cell power plants, solar energy property,
and fiber-optic property used to illuminate the inside of a structure. Credits may be taken against
the alternative minimum tax. Expires after December 31, 2015.
“The United States has the best solar resources in the industrialized world, and we should be a
world leader in capitalizing on those resources,” said Resch.“This bill strengthens America’s economic
future as well as our energy security. It will stimulate economic investment and create high-quality
renewable industry jobs in every state across the U.S.”
SEIA estimated that a long-term credit extension would create approximately 55,000 solar industry
jobs by 2015 and encourage states to invest billions of dollars in renewable energy infrastructure.
Solar energy would displace four trillion cubic feet of natural gas under the bill, saving American
consumers $32 billion over equipment lifetimes.
“Natural gas is a critical part of our energy infrastructure, but we have the highest and most volatile
prices in the world,” Resch said. “Solar is the ideal renewable energy technology to displace a
portion of the natural gas demand and relieve some of the tightness in the natural gas markets.
Solar power is greatest from 9-6 every day-the time that the grid experiences peak power demand
– and displaces the need for peaking and intermediate power plants run on natural gas.” |
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