Today 88 members of the U.S. House of Representatives called for an extension of the successful 1603 Treasury Grant Program supporting renewable energy projects, urging in a letter to House leaders that such an extension will continue a proven track record of job creation and promote further growth in domestic clean energy industries.
Created in 2009, the 1603 program has provided essential financing for clean energy projects via grants in lieu of investment tax credits, and has created tens of thousands of jobs by leveraging more than $22.8 billion in private financing to support 22,000 renewable energy projects in all 50 states. Signatories of the letter - led by Reps. Earl Blumenauer (D-OR), Rush Holt (D-NJ), Paul Tonko (D-NY), Mike Thompson (D-CA), and backed by the House Sustainable Energy & Environment Coalition (SEEC) - argue that a failure to extend the 1603 program beyond its current December 31 expiration date would have significant adverse effects on American clean energy industries; shrinking the total financing available for renewable energy projects by 52 percent in 2012, and eliminating tens of thousands of jobs.
"The 1603 Treasury Grant Program is a job creator and economic stimulator," said Rep. Thompson. "It has created tens of thousands of jobs across the clean energy sector and pumped nearly 23 billion private sector dollars into the economy. Nearly 12,000 projects in my state of California have benefited. Congress must act to renew this program -- it is good for our environment, good for our economy and helps reduce our dependence on foreign oil."
"It is absolutely essential that we extend the 1603 clean energy program to ensure that these job-creating projects continue to have access to financing and that we continue to lead the world in clean energy innovation," said Rep. Blumenauer. "My office has received a flood of encouragement for continuing this program from businesses that are creating good jobs in Oregon, the urban and rural communities that these projects support, and from consumers interested in purchasing clean energy across America. With countries like China and Germany deploying renewables like solar and wind at a faster rate than the United States, we need to support the entrepreneurs and workers who are launching clean energy projects here in America."
"Congress must support innovation and job creation by extending the 1603 program," said Rep. Holt. "At a time when our economy is already fragile, abandoning investment in the sustainable energy sector would cause the U.S. to lose even more high-tech jobs to our foreign competitors, and it would undermine the progress of much-needed new energy technologies."
"In the global race on clean energy and innovation, we must make certain that America finishes first," said Rep. Tonko. "A critical step in remaining competitive is the extension of the 1603 Treasury program, which provides the necessary financing and investment to enable American ideas, American intellect and American know-how to develop the ideas and products of the future. This bold investment has helped create jobs, rebuild the economy and support small and large businesses nationwide -- that's why it must be extended."
Last month over 750 small businesses, companies, and trade organizations wrote to Congress urging an extension of the highly successful 1603 program.
Below is the text of the letter sent by the members of Congress:
Dear Speaker Boehner, Leader Pelosi, Leader Cantor, and Whip Hoyer:
We write to urge extension of the highly successful grant program for specified energy property in lieu of tax credits (the "1603 Treasury Grant Program") before it expires on December 31, 2011. Since enactment, this program has leveraged more than $22.8 billion in private sector investment for 22,000 projects across the clean energy industry, including solar, wind, biomass, fuel cells, combined heat-and-power, and hydro, in all 50 states. Extension of this successful and effective program will create jobs, spur economic growth, and promote private sector development of clean energy technologies.
Prior to the 2008 financial crisis, clean energy project developers primarily relied on tax equity partnerships with investors to utilize clean energy tax incentives. Since 2008, however, the availability of tax equity declined dramatically. According to a report issued by the Bipartisan Policy Center in March 2011, the number of tax equity investors shrunk by nearly half, with associated tax equity financing tumbling over 80 percent from $6.1 billion in 2007 to $1.2 billion in 2009. This decline severely limited the financing available for energy projects.
Congress enacted the 1603 Treasury Grant Program to restore the availability of financing for renewable energy projects and to create domestic jobs in a hard hit sector of the economy. Under the program, developers receive a federal grant in lieu of the tax credit--changing the timing of when the energy incentive can be claimed. This change in timing, however, provides the liquidity and funding needed to develop domestic energy projects. As a result, the program underpinned strong growth in the renewable energy sector during the current economic downturn.
Despite some improvement, the tax equity market is still unable to support the clean energy industry adequately. In July 2011, the U.S. Partnership for Renewable Energy Finance surveyed tax equity investors and found that expiration of the program would shrink the total financing available for renewable energy projects by 52 percent in 2012. Allowing the 1603 Treasury Grant Program to lapse would eliminate tens of thousands of jobs across all clean energy industries. Given the program's importance, as well as its proven record of success, we urge you to include its extension in any year-end legislation considered by the House.
Representatives Earl Blumenauer, Rush Holt, Paul Tonko, Mike Thompson, Steve Israel, Lois Capps, Jared Polis, Jay Inslee, Chris Van Hollen, Edward J. Markey, Henry A. Waxman, George Miller, Barney Frank, Maurice D. Hinchey, Gerald E. Connolly, Rick Larsen, Shelley Berkley, Jim Langevin, Joe Courtney, Doris O. Matsui, John Garamendi, William R. Keating, Ben Ray Lujan, Martin Heinrich, Steve Cohen, Jim McDermott, John W. Olver, Mike Quigley, Jerry McNerney, Allyson Y. Schwartz, David N. Cicilline, John Conyers, Carolyn M. Maloney, Richard E. Neal, Howard L. Berman, Barbara Lee, Lynn Woolsey, Dale E. Kildee, Eleanor Holmes Norton, Peter A. DeFazio, Chellie Pingree, Tim Ryan, Emmanuel Cleaver, Zoe Lofgren, Susan A. Davis, Grace F. Napolitano, Raul M. Grijalva, Michael M. Honda, Russ Carnahan, Steven Rothman, Bob Filner, Lucille Roybal-Allard, Jesse Jackson, Jr., Bill Owens, C.A. Dutch Ruppersberger, Peter Welch, Brian Higgins, Mazie K. Hirono, Stephen F. Lynch, Michael H. Michaud, Brad Sherman, Diana Degette, John D. Dingell, Gary L. Ackerman, Rosa DeLauro, Anna G. Eshoo, Mark Critz, John F. Tierney, Pete Stark, Sam Farr, Adam B. Schiff, Marcy Kaptur, John Yarmuth, Jackie Speier, Laura Richardson, Kurt Schrader, Norm Dicks, Jim Costa, Tim J. Walz, Niki Tsongas, Leonard L. Boswell, Dave Loebsack, James P. McGovern, David Price, Dennis Cardoza, Jim Moran, Linda T. Sanchez, Dan Lipinski
CC: The Honorable Dave Camp, Chairman, House Ways & Means Committee
The Honorable Sander M. Levin, Ranking Member, House Ways & Means Committee