Renewables Tax Credit Comes Up Short in Senate, Again

Late Wednesday evening a Senate stimulus package including tax credit extensions for renewable energy fell one vote short of the 60 needed to invoke cloture and avoid a minority filibuster.

The Senate Finance Committee included $5.5 billion worth of tax-credit extensions for wind, solar and other renewables in the stimulus package, hoping political pressure to move the bill to the president by February 15 would overcome Republican objections.

But Republicans immediately threatened with a filibuster, forcing Democrats to delay the cloture vote in the hopes of rallying additional support. But in the end, even though a few republicans supported the extension of the Production Tax Credit (PTC), it was not enough.

The PTC provision would have extended the credit until the end of 2009. It is set to expire at the end of 2008. Democrats say they remain committed to extending the credit, but they will have to find another bill in which to do it.

Republicans also successfully blocked the credit extension from being included in the Energy Bill, passed at the end of last year.

Randall Swisher,Executive Director of the American Wind Energy Association said, "With 116,000 renewable energy jobs and nearly $19 billion in investment at risk in the renewable energy industries, a minority of the Senate has again frustrated the desire of millions of Americans across the political spectrum who overwhelmingly support clean, home-grown energy."

Even if the measure had passed in the Senate, the PTC extension would still need to be approved by the House, which passed the stimulus package earlier in the week without the tax credit.

Although pressure is building to extend the tax credits before they expire at the end of the year, ultimately the renewables industry would like to see more than a one-year, stop-gap extension.

The Solar Energy Industries Association is asking for a commercial extension of the credit for 8 years to provide greater security for investors. And they recommend a 6 year extension for residential projects, as well as removal of the $2,000 cap for the residential credit.