If you have not been keeping up with congress and whats been going on with our current energy bills and tax incentives, here is a little refresher course:
Back in 2006 a fantastic bill was passed that authorized many different tax incentives which rewarded individuals and businesses for using energy efficient products, renewable energy and hybrid vehicles. These tax incentives have been responsible for huge decreases in the price of solar and wind technologies, bringing us closer and closer to grid parity. But, in January of 2008, in the most recent energy bill, all of these major tax incentives were stripped out of the bill and left to expire in December of 2008. The main reason that these provisions were stripped out of the last energy bill is because the bill was attempting to drastically cut current tax breaks available to major oil and gas companies. This was the fail point for the entire bill which caused it to be reconfigured (subtracting all of the good stuff) and then passed through as an energy bill (with total disregard for alternative energy).
Now, there is a new bill (H.R. 5351, the Renewable Energy and Energy Conservation Tax Act of 2008) on the table which would not only extend all of the “set to expire” tax credits, but would improve almost all of them. Some of the major provisions included are extensions and increases to, the residential energy-efficient property credit, the solar energy and fuel cell investment tax credit, renewable energy production tax credit and many more.
This bill, unlike the last one is not proposing to “cut” tax breaks for major oil producers, instead it is proposing a freeze on the current law section 199 benefits, at 6% for oil and natural gas production income. Section 199 which would otherwise increase to 9% by 2010, would simply stop at its current rate and save approximately $13.57 million over a ten year period. The bill also proposes a clarification to an existing tax code which would eliminate the potential for major oil and gas companies to manipulate their extraction income in order to achieve beneficial results under U.S. foreign tax credit rules. This small clarification would raise approximately $4.08 billion over ten years, and would more than cover the proposed renewable energy and energy efficiency tax incentives.
The incentives in this bill will help architects, engineers, developers, home builders and home owners make their properties more energy efficient. They will help lower energy costs, and they help improve the environment. However, unless Congress acts now to extend them, we may loose them. So, we urge you to take a few minutes and write, call or email your local congressmen and ask them to support the Renewable Energy and Energy Conservation Tax Act of 2008, H.R. 5351.