The U.S. Government Accountability Office (GAO) released a report in response to a request from a bipartisan group of U.S. Senators detailing the effects of the United States' energy policy on the American Public. Senators Olympia J. Snowe (R-Maine) and Jeff Bingaman (D-New Mexico) were joined by Max Baucus (D-Montana), Dianne Feinstein (D-California), and John Kerry (D-Massachusetts) in writing to the GAO in November 2009 to request the study to determine the effects of residential energy efficiency tax credits and provide suggestions on improving these policies.
The GAO report indicated that $5.288 billion was claimed in 2009 in total tax credits, significantly above the $2 billion estimated cost for both 2009 and 2010 when the tax credit was enacted in the American Recovery and Reinvestment Act. The Senators requested the report to find ways the tax credit can be structured and overhauled to reflect rising energy costs to best reduce CO2 emissions and the nation's reliance on foreign oil.
"At a time when Americans spent nearly $500 billion on energy alone last year, we must aggressively overhaul our energy tax policies to put the focus on helping Americans reduce their energy bills," said Senator Snowe. "I have long said our nation lacks a comprehensive energy policy and that it is vital we prioritize energy efficiency as we restructure our tax system for the long term. This approach can immediately cut the use of expensive oil and I am encouraged the GAO report highlights that performance-base tax policies, such as the "Cut Energy Bills at Home Act' that I have introduced can catalyze investments in energy-saving products and "better target conservation investment spending.' Our energy tax policies must singularly focused at responsibly reducing energy bills and I urge my colleagues to join me in overhauling our energy tax code and assisting homeowners investing in energy saving technologies."
"This GAO report highlights some key ways to improve this important tax incentive when Congress takes up the task of updating our energy tax laws, which it should turn to as soon as possible," Bingaman said.