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Hearing of the Energy, Natural Resources & Infrastructure Subcommittee of the Senate Finance Committee - Opening Statement of Sen Bingaman, Hearing on Tax Reform and Federal Energy Policy


Location: Washington, DC

Good morning. Today's hearing examines tax reform and federal energy policy, and considers incentives to promote the efficient use of our energy resources.

The tax code has long served to promote energy policy goals. For most of this time, the Code offered only incentives for the production of energy -- first from mineral resources and then from oil and gas. Recent years have brought important incentives for renewable energy resources, though they still remain temporary and uncertain.

Even more recently, however, Congress has decided to reintroduce certain tax incentives that promote the efficient use of energy -- recognizing the value in preserving our domestic resources by developing technologies that use less energy to accomplish the same task.

However, with the possibility of comprehensive tax reform, and within the context of a contentious debate on how to close the federal deficit, we must assess existing policies to determine if their goals are worth the cost. If they are, and I believe energy efficiency is a worthy policy goal, then we must examine the best and least-cost ways to promote those policies.

At today's hearing, we have a panel of expert witnesses who will help us consider the following three issues:

First, to understand the opportunities presented to our economy, our energy infrastructure, and to the environment that result from the efficient use of our resources;

Second, to consider if creating incentives through the tax code is a sensible and efficient way of promoting energy efficiency investments, and if so, then;
Third, to examine how we can improve our existing incentives to make them more effective, easier to use, and less expensive to the federal government.

Over the past two Congresses, Senator Snowe and I, along with Senator Feinstein and others, including Senator Cardin, have worked to develop reforms to our existing efficiency incentives. Whenever possible, we have adhered to general principles that we believe to be consistent with the goals of tax reform. We have striven to provide technology-neutral structures that offer incentives based on performance, not cost. We have worked to ensure that the efficiency savings are able to be measured and verified, and that fraud, waste, and abuse are minimized to the greatest extent possible. Finally, we have sought to ensure that innovative new efficiency technologies can utilize existing policies.
The result of our work is three bills introduced in this Congress: one focusing on the commercial buildings deduction, one focusing on tax credits for homeowners, and one that promotes efficiency in the industrial sector.
I hope that we can examine how these bills fit into the discussion I outlined above. I welcome an honest assessment of these bills and encourage any thoughts on how to improve them.

This morning's hearing will consist of one panel. I would like to welcome the witnesses.

First is Dr. Dan Arvizu, Director of the National Renewable Energy Laboratory in Golden, Colorado.

Next is Mr. Steve Nadel, Executive Director of the American Council for an Energy-Efficient Economy.

Then we have Mr. Mark Wagner, Vice President Government Relations, Johnson Controls, Inc.

Finally, I would like to welcome Mr. Matt Golden, a principal at Efficiency Dot Org and the policy chair at Efficiency First.

I would like to ask our witnesses to limit their testimony to five minutes; your entire written statement will be included in the record.

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