By a vote of 236 to 189 Democrats in the House of Representatives have successfully led an effort to pass “The Comprehensive American Energy Security & Consumer Protection Act,” a bill that’s touted as providing federal incentives that will lower costs to consumers, foster development of clean, renewable energy sources, expand domestic energy supply and promote greater energy efficiency and conservation.
Key features of the Act include a 15% Renewable Electricity Standard, extension of investment tax credits for wind, solar, biofuels and other renewable energy resources, as well as incentives for green building and home energy efficiency and conservation and expanding offshore drilling but protecting sensitive areas such as Georges Bank. The Bill also calls for establishing a Strategic Renewable Energy Reserve, funding for which would come from ending some subsidies and tax breaks for Big Oil.
The Green Road to Economic Recovery
House Democrats are leading a push to rejuvenate the American economy and address climate change by putting it on a more sustainable path. Providing incentives for renewable energy and clean technology development, along with promoting energy conservation and efficiency measures are the keys to the Democrats’ plan.
“From an energy crisis to a credit crunch, a housing sector in shambles and an automotive sector in need of rejuvenation, America’s economy is in need of new policies and new engines,” according to the House Select Committee.
“In looking for new ways to stimulate the economy, clean energy and climate-friendly policies should be at the top of America’s list. Clean energy like wind and solar can create well-paying jobs here at home and American-made hybrid engines can be the economic engines for America for years to come.”
Congress in December passed the bi-partisan “Energy Independence and Security Act,” which increased fuel economy standards for the first time in 32 years. The Bush-Cheney administration and Republican Congressional leaders have successfully blocked subsequent efforts to pass key legislation that would invest in renewable energy, provide immediate relief from gas and energy price hikes, and invest in increasing the energy efficiency of homes and buildings, however, according to the Select Committee.
A Last Legislative Push
Democrats are making one final push to shepherd the “The Comprehensive American Energy and Security, Consumer Protection Act” before the 110th Congress draws to a close. Investing in renewable energy creates three to five times as many jobs as equivalent investments in fossil fuel energy sources, according to estimates.
Besides renewing the investment tax credit for wind, solar and biofuels, the legislation would extend and expand tax incentives for investment in plug-in electric vehicles and energy efficient homes, buildings and appliances, assuring that existing employment will be retained and new jobs continue to be created.
What has become a ritual of extending investment tax credits for wind, solar and other renewable energy is constraining what is now a vital, diverse and growing sector of the American economy by raising the uncertainty, risk and cost of financing investment.
Renewable energy project, technology and equipment developers, as well as distributors, retailers, installers and service companies are all on pins and needles every time a new expiration deadline looms and Congress and the President hold off, haggle and barter over whether or not to renew the investment tax credit and for how long. Meanwhile, projects are delayed or put on the shelf, investment costs rise and jobs are threatened.
Investing in Renewables, Removing Subsidies, Tax Breaks for Big Oil
The legislation all includes establishing a Renewable Electricity Standard that would require utilities to generate 15% of electricity from renewable sources by 2020. Up to 4% of the target could be achieved by increasing energy efficiency. It’s estimated that doing so would reduce global warming emissions and lower energy prices, saving consumers from $13-$18 billion cumulatively by 2020.
In addition, the Bill also includes establishing a Strategic Renewable Energy Reserve funded by removing tax breaks for oil companies and requiring them to pay more for drilling and production on public lands.
Oil companies pay zero royalties on 70% of Gulf of Mexico oil leases issued in 1998 and 1999, cutting into federal revenues by some $15 billion, according to the Select Committee. The Bill would also repeal tax subsidies granted in the 2004 international tax bill (H.R. 4520) but only for the “Big Five” oil companies. Small, independent oil and gas companies would continue to benefit from the tax deduction at the current rate. It also closes a foreign tax loophole (H.R. 5351) that “Big Oil” has benefited from.
The Reserve would then invest in developing clean, renewable energy resources and alternative fuels, promote new energy technologies, and foster greater energy efficiency and conservation. It would also fund home heating assistance and weatherization plans, the Land and Water Conservation Fund and carbon capture and sequestration.
The Bill also calls for the temporary release of 10% of the oil in the Strategic Petroleum Reserve on to the domestic market to bring gasoline and diesel prices down. The drawdown would be replaced at a future date with heavier, cheaper crude. According to the Select Committee past releases have brought down prices by as much as 33%.