Bipartisan Breakthrough Accelerates Transition to Clean Energy Future

Press Release

Bipartisan Breakthrough Accelerates Transition to Clean Energy Future
Cantwell-Backed Formula Uses Oil Company Subsidies to Pay for New Clean Energy Tax Credits, Real Consumer Relief from High Energy Costs

Today, U.S. Senator Maria Cantwell (D-WA) led efforts to pass a package of landmark bipartisan clean energy tax policies that will provide predictability, and spark investment,for U.S. clean energy industries. The package, passed by a vote of 93 to 2 in the Senate includes a number of new provisions including: an eight year commercial solar and fuel cell investment tax credit; new credits for ocean energy projects; tax credits for homeowners who install solar, small wind or geothermal heat pumps; a tax credit up to $7500 for new car buyers who purchase a plug-in electric vehicle, based on legislation authored by Cantwell; and a new credit for consumers who use alternative methods to heat their homes, such as wood pellet stoves. The bill also creates an incentive to install new smart meters which empower homeowners to take control of their energy use.

"For the first time the U.S. Senate passed legislation that takes unnecessary subsidies away from oil and gas companies, who have seen record profits quarter after quarter, and invests those dollars to accelerate America's transition to a cleaner and more renewable energy system," said Cantwell. "By extending and expanding these tax incentives, we will unleash the abundant and almost limitless power of solar energy and other renewables to provide emissions-free power generation. From the new opportunities provided in this bill, Americans will not only get real tax reliefand more jobs in a fast growing industry, we will be one step closer to a safer and more secure energy future."

The renewable energy tax credits will be fully paid for by a combination of offsets including freezing the tax deduction for the domestic manufacturing activities of American oil and gas companies, tightening the rules by which oil and gas companies pay taxes on income earned overseas,with increased payments into the oil spill liability trust fund and two other non-oil and gas related revenue raisers. Today's vote overcomes a Republican filibuster which prevented eight previous clean energy bills from becoming law.

"This landmark package will benefit American families and businesses by creating over half a million high wage jobs right here in America, empower homeowners to reduce their energy bills, and diminish our debilitating overdependence on fossil fuels," continued Cantwell. "As a nation, we must transform the way we generate and consume energy by promoting investments in clean energy generation and increasing our nation's energy productivity. Today, we have taken a significant step in the right direction."

Specifically, the package:

* Extends the production credit for electricity produced from renewables, like wind, biomass and incremental hydropower. For the first time these production tax credits are extended to wave, tidal, and hydrokinectic technologies which have particular promise in the Pacific Northwest.
* Extends the investment tax credit for solar for eight years, providing the solar industry the market certainty they need to create 440,000 jobs nationally by 2016. In Washington state that translates to more than 10,000 permanent green collar jobs and up to 15,000 construction jobs.
* Extends and expands the Clean Renewable Energy Bonds (CREBs) program that enables public power and consumer-owned utilities that cannot benefit from federal tax credits reduce their renewable energy investment costs.

* In Washington State, 1,000 megawatts of installed wind capacity has already created employment for 2,650 Washingtonians during project construction and an additional 400 permanent jobs for a total economic benefit of $1.1 billion.

* Creates high-paying renewable industry jobs: manufacturing (ie, welders, technicians, assembly, etc.) averaging $41,000, engineering averaging $117,000 and and non-technical (sales, marketing, development, financial, etc.) averaging $52,500.

Helps Americans Save Money By Lowering Their Energy Bills

* Helps homeowners generate their own electricity and hot water by providing a 30 percent tax credit towards the installation of solar electric or hot water systems, and expands the credit to cover residential wind generators and geothermal heat pumps. Homeowners installing these technologies can reduce a household's water heating costs by 50 percent and save Americans $350 a year in energy costs.
* Consumers can also save up to $500 on their taxes if they install energy efficient products in their homes which can translate to big energy savings. For example, installing energy efficient windows that can save an average homeowner $125 to $450 each year and high efficiency heating and cooling equipment can save up to $170 per year, knocking off nearly 10 percent off an average homeowner's annual energy bill.
* Provides new car buyers up to $7,500 to buy plug-in electric cars, trucks or SUVs - vehicles that will start appearing in showroom in 2010 and will likely achieve over 100 miles per gallon. According to a study by the Pacific Northwest National Laboratory, our current electricity infrastructure could support an estimated 70 percent of America's passenger vehicle fleet, which would displace 6.5 million barrels of oil each day, an amount equivalent to 50 percent of our oil imports, and cut greenhouse gases by an estimated 20 percent. And in Washington state, the cost of powering plug-in vehicles would be the equivalent of 70 cents per gallon. This provision is derived from a bipartisan bill authored by Senators Cantwell, Hatch, and Obama last year.
* For the first time, energy-efficient biomass fuel stoves, including wood pellets stoves, are eligible for a consumer tax credit of $300. These stoves can provide an alternative way for homeowners to use renewable resources to heat their homes. Sixty percent of wood pellet stoves on the market are manufactured in Washington state.

Makes America's Electricity Grid More Intelligent

* Provides utilities a tax incentive to put smart meters in Washington homes and businesses. Smart meters are necessary for businesses, homes, and utilities to take advantage of efficient and renewable energy opportunities.
* Making our electricity grid more intelligent will provide double digit cost savings and help prevent future blackouts.
* Washington state is home to Itron, one of the world's largest smart meter manufacturers, as well as a number of leading edge smart grid companies and researchers.

Cantwell has made making our nation's energy system cleaner, more efficient, and more diverse one of her top priorities. She leverages her membership on the Senate Energy and Natural Resources, Commerce, and Finance Committees to push her vision of a clean energy economy and to support budding clean energy industries, while bringing tax relief to the American people.

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