With the end of the 111th Congress fast approaching and both the Senate and the House of Representatives scrambling to get major legislation passed before Dec. 31, many industries and organizations are pressuring lawmakers not to forget their needs.
The alternative energy industry is no exception. Groups representing the solar and wind industries are imploring lawmakers to extend the Clean Energy Treasury Grant Program, also called the Section 1603 tax credit, a part of the American Recovery and Reinvestment Act of 2009, which is due to expire at year's end.
The Treasury Grant Program is one of the most successful parts of the stimulus bill. It has spurred industry to invest in tens of billions of dollars of renewable energy alternatives and created over 143,000 jobs, said Sen. Maria Cantwell, D-WA, the prime sponsor of legislation to extend the program for two years.
Investments in renewable energy projects will grind to a halt, along with the job creation that comes with it, unless this program is extended, Cantwell said.
Cantwell, who has been pushing to renew the program since June, again raised the issue this week as Senate Democrats discuss how to proceed with legislative efforts in the lame duck Congress.
The Solar Energy Industries Association and the American Wind Energy Association agree with the Senator that action on the program is critical.
Failing to extend the 1603 tax credit jeopardizes tens of thousands of jobs and threatens to slow the growth of America's fast-growing clean energy industries, the SEIA and the AWEA said Tuesday in a joint release.
According to the associations, the Treasury Grant Program has supported 1,179 solar projects with total investments of over $1.3 billion in 42 states and 211 wind projects with total investments of over $15 billion in 38 states.
According to a recent Lawrence Berkeley National Laboratory Report, not only will the program create over 143,000 jobs by the end of the year, it will also enable 4,250 megawatts of renewable power projects to come online.
The program has succeeded with its intended purpose of stimulating financing and installation of renewable energy projects despite the slow economic recovery and loss of the tax equity finance market, the groups said.
Prior to the financial crisis, many renewable energy projects relied upon third party tax equity investors to monetize the value of federal renewable energy incentives, said Rhone Resch, CEO of SEIA. The economic downturn dramatically reduced the availability of tax equity, severely limiting the financing available for renewable energy projects.
Resch explained that the Treasury Grant Program eliminates the need to secure scarce tax equity to finance solar or wind projects.
The program allows the owner of commercial solar or wind property to receive a 30 percent grant, in lieu of taking the industry tax credit. This funding has supported the industry during these lean times and, since industry leaders expect the tax equity finance market to stay anemic for at least the next two years, renewal of the program becomes crucial.
We have people being laid off right now, and we expect to see more without fast action on the tax extenders now being negotiated, said Denise Bode, CEO of AWEA.
According to AWEA's research, there are over 15,000 jobs in the wind industry manufacturing pipeline alone.
We are risking those jobs by not sending a clear signal that America remains open for business in wind energy, Bode said.
The program saved 55,000 jobs in wind energy, as estimated in Berkeley report.
Overall employment has reached 85,000 in the American wind industry, as installed capacity has grown 40 percent in each of the past two years. Wind now generates 20 percent of the electricity in Iowa. On Oct. 28, high winds pushed wind power to 25 percent of the electrical generation in Texas, according to AWEA.
Sen. Dianne Feinstein, D-CA, who along with Cantwell and 24 other Democrats called for a two-year extension of the grant program late last month, told reporters Tuesday that she planned to make a list of renewable energy projects that will not go ahead if Congress fails to extend the program.
But Feinstein could not say with certainty whether supporters will be able to add the extension to the package of bills being considered.
It's a fluid situation, said Debra Preitkis-Jones, spokesperson for AWEA. The tax extender's bill was brought in last week and there are a number of Senators working to put this back into the framework.