Democrats are saying that extending expiring tax subsidies for renewable energy production is good for job creation and economic growth.
Specifically, some Democrats are pushing for the extension of ten tax credits for renewable energy production, including subsidies for wind power, solar power, hybrid vehicles and energy efficient appliances.
“If a broader tax code overhaul cannot be achieved by year’s end, it is imperative that these key clean energy tax incentives are renewed as soon as possible,” wrote members of the House Sustainable Energy and Environment Coalition — who are all Democrats — to leadership on the House Ways and Means Committee on Monday.
“These tax credits have helped scale up production and drive down the cost of clean energy technologies,” the letter continues. “They remain critical to addressing the market failures that prevent cost-effective, market-ready technologies from being deployed to their full potential. With continued support, clean energy will help Americans save money on their energy bills and reduce harmful pollution.”
Another group of Democratic and Democratic-leaning lawmakers led by Massachusetts Sen. Ed Markey have written Senate Finance Committee leadership on Monday also as well, urging for their support in extending green subsidies.
Congress is currently in the process of discussing options for large-scale tax reform, but will not likely come to any sort of agreement before the end of the year. The most recent draft proposal from Democratic Montana Sen. Max Baucus left green energy tax credits blowing in the wind by not offering any suggestion if they should be extended or not.
“[W]hile the staff discussion draft slows down the cost recovery of certain energy assets, the Chairman’s staff is considering improving and making permanent certain energy tax credits set to expire in 2013,” reads Baucus’s draft legislation.
However, renewable energy tax credits have come under fire from conservative groups and some Republican lawmakers who wish to see them expire this year. The main target of conservative efforts to end green tax credits have focused on ending the 20-year-old Wind Production Tax Credit.
“The growth in wind is driven not by market demand, but by a combination of state renewable portfolio standards and a tax credit that is now more valuable than the price of the electricity the plants actually generate,” reads a letter from Kansas Republican Rep. Mike Pompeo and 51 lawmakers to Rep. Dave Camp, the chairman of the House Ways and Means Committee, opposing wind tax credits.
“The principal federal support for the wind energy industry is scheduled to expire at the end of this year,” reads the letter from 102 conservative groups led by Americans for Prosperity. “The undersigned organizations and the millions of Americans we represent stand opposed to extending the production tax credit (PTC).”
The campaign against wind power comes as pro-wind forces push for the tax credit to be extended at least another year in order to keep the industry afloat. According to the Joint Committee on Taxation, another one-year extension is estimated to cost taxpayers $6 billion.
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