GRASSLEY WORKS FOR DEVELOPMENT OF RENEWABLE FUELS IN IOWA, NATIONWIDE
U.S. Senator Chuck Grassley today congratulated the Iowa Renewable Fuels Association on the completion of its second annual Renewable Fuels Summit.
" Iowa is leading the way in future-focused renewable energy," Grassley said. "The RFA summit provided important leadership in bringing together stakeholders, entrepreneurs and developers of new opportunities, especially for ethanol, in our state."
Grassley said he's working this year for passage of an energy tax package he put forward last year that would build on the substantial renewable energy tax policy gains he shepherded through Congress in 2005. This includes the ethanol production tax credit and the ethanol import tariff which have been essential to the growth of the Iowa ethanol industry. Grassley also said he's working for final passage of the renewable energy tax provisions he sponsored in the Senate farm bill. Members of the House and Senate are at work in a conference committee to reconcile House and Senate versions of farm bills.
In addition, Grassley said he's working to win extensions of expiring tax provisions for renewable energy, including extension of the wind-energy production tax credit which he first authored 15 years ago. On Wednesday, the Finance Committee approved a Grassley-sponsored amendment to include these items in an economic stimulus bill. "The high price of oil helped to start the economic downturn, so it makes sense that the economic stimulus package should reflect the nation's commitment to energy efficiency and alternative energy."
Grassley is a long-time advocate for ethanol, going back to 1990, when he helped win passage of the ethanol requirement included in the Clean Air Act. In 1997, he overcame the strong opposition of Senate leaders to win a ten-year extension of the ethanol tax credit.
Last month, Grassley met with executives of leading Spanish renewable energy companies in Madrid . Senator Grassley promoted Iowa as a renewable energy leader and encouraged cooperation between Iowa and on renewable energy. He encouraged them to look at Iowa for future investment in renewable energy production and technology development.
As a leader on the Senate tax policy committee, Grassley has also spearheaded efforts for use of wind energy, biomass and biodiesel. Grassley legislation created the first-ever wind energy production tax credit in the Energy Incentives Act of 1993. The Growing Renewable Energy for Emerging Needs (GREEN) Act extended the tax credit for the production of energy from biomass. Grassley also introduced the Biodiesel Promotion and Quality Assurance Act in 2007. The inclusion of this policy in the Energy Independence and Security Act of 2007 created a mandate for the consumption of 500 million gallons of biomass-based diesel in 2009 increasing to 1 billion gallons in 2012.
The renewable energy tax initiatives listed here are included in the Grassley energy tax bill first proposed last year and/or the farm bill where differences between House and Senate versions are currently being worked out.
* Cellulosic Ethanol Production Credit - Would create a new production tax credit of 50 cents per gallon for up to 60 million gallons of Cellulosic fuel production in a taxable year. The credit is available through December 31, 2012 or when 1 billion gallons has been produced. Included in energy tax title
* Expensing for Cellulosic Ethanol Facility - Would expand the eligible property qualifying for the 50 percent expensing to include any process directly employing any lignocellulosic or hemicellulosic matter that is available on a renewable or recurring basis. Included in energy tax title and farm bill
* Small Ethanol Producer Credit - Would extend the 10 cent per gallon tax credit through December 31, 2012 on the first 15 million gallons of ethanol production for producers with annual capacity of not more than 60 million gallons. Included in energy tax title and farm bill
* Fossil Free Alcohol Production Tax Credit - Would establish a new small producer alcohol tax credit of 25 cents per gallon for facilities that produce ethanol through a process that does not use a fossil-based resource. The credit is available through December 31, 2012. Included in energy tax title and farm bill at 10 cents pre gallon through December 31, 2011
* Extension of the Tariff on Ethanol - Would extend the tariff on imported ethanol through December 31, 2010. Included in energy tax title and farm bill
· Small Producer Credit for Cellulosic Biofuels. Would create a new production
tax credit of 64¢ per gallon (in addition to the current 51¢ per gallon ethanol credit and the 10¢ per gallon credit for small producers) for cellulosic biofuels. The credit is available through the first quarter of 2015, and there is no per-taxpayer limit on the amount of annual credits that can be claimed. The proposal also waives, for production of cellulosic biofuels, the 15 million-gallon limitation on the 10¢ small producer credit. Included in farm bill
* Biodiesel Tax Credit - Would extend for two years, through December 31, 2010, the $1 and 50 cent production tax credits for biodiesel. Included in energy tax title and farm bill
* Small Biodiesel Producer Credit - Would extend for four years, through December 31, 2012, the 10 cent per-gallon tax credit on the first 15 million gallons of biodiesel production for producers with annual capacity of not more than 60 million gallons. Included in energy tax title and farm bill
* Alternative Refueling Stations - Would extend through December 31, 2012 the 30% credit for alternative refueling property. The credit is capped at $30,000. Included in energy tax title and farm bill through December 31, 2010
* Extension and Modification of Renewable Electricity Credit - Would extend the production tax credit for electricity produced from wind, closed-loop biomass, open-loop biomass, and other sources by five years, through December 31, 2013. Included in energy tax title
* Clean Renewable Energy Bonds - Would authorize $900 million in each of calendar years 2008, 2009, 2010, and 2011. Clean Renewable Energy Bonds are defined as bonds issued by a qualified issuer if, in addition to other requirements, 95 percent of the proceeds are used to finance capital expenditures incurred for facilities qualifying for tax credits under Section 45. Qualified issuers include governmental bodies (including Indian tribal governments) and mutual or cooperative electric companies. Included in energy tax title
* Residential Wind Credit - Would create a new 30 percent personal credit for residential wind property capped at $4,000. The credit is available through December 31, 2014. Included in energy tax title and farm bill through December 31, 2008
The renewable energy tax extensions listed here are included in the Grassley amendment approved Wednesday by the Senate Committee on Finance.
§ Electricity produced from certain renewable resources credit (Section 45) - Would extend the production credit for electricity produced from wind, closed-loop biomass, open-loop biomass, and other sources by one year, through Dec. 31, 2009.
§ Clean renewable energy bonds credit - Would add an additional $400 million to a category of tax credit bond called Clean Renewable Energy Bonds ("CREBs"). CREBs are defined as bonds issued by a qualified issuer if, in addition to other requirements, 95 percent of the proceeds are used to finance capital expenditures incurred for facilities qualifying for tax credits under Section 45. Qualified issuers include governmental bodies (including Indian tribal governments) and mutual or cooperative electric companies. The provision is effective for bonds issued after Dec. 31, 2008.
§ Energy-efficient commercial buildings deduction - Would extend for one year a deduction for energy-efficient commercial buildings that reduce annual energy and power consumption by 50 percent compared to the American Society of Heating, Refrigerating, and Air Conditioning Engineers (ASHRAE) standard.
§ New energy-efficient homes construction credit - Would extend for one year a credit to eligible contractors for the construction of a qualified new energy-efficient home. The credit applies to manufactured homes meeting Energy Star Standards and other homes meeting a 50 percent standard. The credit applies to homes purchased prior to Jan.1, 2010.
§ Residential energy efficient property credit - Would extend for one year a credit, equal to 30 percent of qualifying expenditures, for the purchase for qualified photovoltaic property and solar water heating property used exclusively for purposes other than heating swimming pools and hot tubs. This also provides a 30 percent credit for the purchase of qualified fuel cell power plants and applies to property placed in service prior to Jan. 1, 2010.
§ Alternative energy credit for electricity production for businesses - Would extend for one year a 30 percent business energy credit for the purchase of qualified fuel cell power plants for businesses and a 10 percent credit for purchase of qualifying stationary microturbine power plants. Additionally, a 30 percent credit for purchase of qualifying solar energy property is also extended. The credits apply to periods before Jan. 1, 2010.
§ Energy-efficient existing homes credit - Would extend the residential property tax credit for two years (through Dec. 31, 2009) for expenditures to improve the energy efficiency of an existing home.
§ Energy-efficient appliances production - Would extend the tax credit for the production of energy efficient appliances for two years (through Dec. 31, 2009). It updates and extends the manufacturing years to 2008 and 2009.
Grassley also has been a key backer in recent years of legislation to dramatically expand the Renewable Fuels Standard. The current standard enacted in 2007 requires the use of 9 billion gallons of renewable fuels in 2008 and increases to 36 billion gallons by 2022. Starting in 2016, 3 billion gallons of renewable fuels must be advanced biofuels like cellulosic ethanol produced from switchgrass, corn stover or wood chips. The mandate for advanced biofuels increases to 21 billion gallons in 2022.
Finally, last year, Grassley introduced the 25 by '25' resolution, which would require 25 percent of the energy supply provided via renewable sources by 2025. It also encourages production of renewable fuels, such as wind, solar energy, ethanol, and biodiesel. The 10 by 10 Act of 2007, which Grassley sponsored, would require each gallon of gasoline sold beginning in 2010 to contain at least 10 percent renewable fuels.
Grassley said there's always more that can be done to support the development of renewable energy. "Homegrown ethanol and other alternative fuels are good, good, good," he said. "They're good for 's energy independence and national security, they're good for the environment, and they're good for rural economies."