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Congresswoman Elise Stefanik

Representing the 21st District of New York

Stefanik Introduces Renewable Electricity Tax Credit Equalization Act

October 25, 2017
Press Release

Washington, DC – Today, Congresswoman Elise Stefanik (R-NY-21) introduced the Renewable Electricity Tax Credit Equalization Act – legislation to extend tax credits for electricity produced from closed-loop biomass, open-loop biomass, geothermal, municipal solid waste, qualified hydropower facilities and marine and hydrokinetic facilities.

“The North Country is the proud home of numerous renewable energy production facilities and it’s important that we ensure these clean energy sources are supported,” said Congresswoman Stefanik. “This commonsense legislation puts biomass, hydropower, geothermal and other renewable energy sources on a level playing field with wind energy facilities. All of these renewable energy sources represent a new frontier for our environment and for economic growth, and it’s important that we give them the support they need.”

Background: Under prior law, Code Section 45 provided a temporary production tax credit (PTC) for renewable electricity produced from certain qualified facilities, including: wind, closed-loop biomass, open-loop biomass, geothermal, municipal solid waste, qualified hydropower facilities and marine and hydrokinetic facilities. The amount of the PTC in the case of wind and geothermal facilities was 1.5 cents per kilowatt hour indexed for inflation (2.3 cents in 2015), and 50% of that amount for open and closed loop biomass, municipal solid waste, hydropower and marine and hydrokinetic facilities.  In addition, Section 45 facilities were eligible to elect to take the Code section 48 investment tax credit (ITC) in lieu of the section 45 PTC.

The Omnibus Spending Act of 2015 extended the section 45 PTC for electricity produced from wind retroactively to January 1, 2015 and prospectively through the end of 2019, as well as the election to take the ITC in lieu of the PTC. The wind credit was phased down by 20% for projects that began construction in 2017, by 40% for projects which begin construction in 2018, and by 60% for projects which begin construction in 2019. The wind credit expires after December 31, 2019.

The Problem: The PTC for the non-wind section 45 technologies was extended for two years in the Protecting Americans from Tax Hikes Act, through December 31, 2016.  This means tax incentives for electricity produced from closed-loop biomass, open-loop biomass, geothermal, municipal solid waste, qualified hydropower facilities and marine and hydrokinetic facilities have now expired. 

The Solution: To stop the federal government from picking winners and losers, Rep. Elise Stefanik introduced the Renewable Electricity Tax Credit Equalization Act. These renewable baseload technologies that were left behind play an indispensable role in maintaining a reliable and functioning electrical grid system, while also supporting the integration of additional wind and solar electricity into the grid.  

Renewable Electricity Tax Credit Equalization Act:

  • Would extend both the Code section 45 PTC and the election to take the section 48 ITC for closed-loop biomass, open-loop biomass, geothermal, landfill gas, trash facilities, qualified hydropower facilities and marine and hydrokinetic facilities.
  • Makes sure this extension is on the same terms and for the same time and phase-out schedule as was provided to section 48 solar energy property in 2015. 

Click here for bill text.

What They’re Saying:

“The hydropower industry applauds Congresswoman Stefanik for her efforts to eliminate the disparity in the tax code that puts hydropower and marine energy projects at an economic disadvantage,” said Linda Church Ciocci, Executive Director of the National Hydropower Association. “Hydropower plays an indispensable role in maintaining a reliable grid system, and has the potential to grow by 50 gigawatts by 2050, creating over 75,000 jobs in the process. Rep. Stefanik’s bill will put hydropower on a level playing field by curtailing the unfair tax policies that are driving away new infrastructure investment.”

"Congresswoman Stefanik has been a consistent and outspoken supporter of renewable energy, including biomass," said Bob Cleaves, president of Biomass Power Association. "We are so grateful for her leadership in creating tax parity for all renewables. Tax credits can make the difference between a proposed project and a completed one, such as with the ReEnergy facility that powers Fort Drum in Rep. Stefanik's district. If this credit passes, we are hopeful that it will lead to new biomass development in areas that can sustain it."

"The biogas industry applauds the introduction of the Renewable Electricity Tax Credit Equalization Act which will fix inequities in our tax code and allow biogas systems and baseload renewable energy project development to grow," said Patrick Serfass, Executive Director of the American Biogas Council. "The US biogas industry has the potential to build at least 13,000 new systems which would catalyze about $40 billion in new capital investments, create 335,000 construction jobs and 23,000 permanent jobs and build the infrastructure we need for recycling organic material and protecting our air, water and soil."

“The Energy Recovery Council applauds Congresswoman Stefanik for introducing legislation that would create a level playing for baseload renewable energy technologies in the federal tax code,” said Ted Michaels, President of the Energy Recovery Council.  “Providing waste-to-energy and other baseload renewable energy sources the same tax treatment that is afforded other renewables will help technologies like waste-to-energy compete fairly in the marketplace, while providing the myriad benefits of generating renewable electricity from post-recycled waste that would otherwise be buried.”

"As one of the larger private owners and operators of hydropower facilities in the US, including numerous dams in Representative Stefanik's district, Brookfield Renewable supports this important bill,” said Nicolas Bossé, Senior Vice President, Government & Regulatory Affairs, Brookfield Renewable. “We appreciate Representative Stefanik's leadership in supporting the hydropower industry, which creates jobs in rural communities, such as those in upstate New York, and provides affordable, clean and reliable electricity to US businesses and families."

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