STOP PRESS: Washington DC, 13 November 2007.
Reports coming out of Washington this week appear to suggest that both the US House of Representatives and the Senate - in committee - are to remove planned concessions from the upcoming Energy Bill, that would have given the renewables industry in the US a huge boost.
Senate Majority Leader Harry Reid and House Majority Leader Nancy Pelosi have reportedly decided to remove the federal renewable portfolio standard (RPS), as well as all tax provisions benefiting renewables.
The contentious Energy Bill is currently being worked on in committee, as the House and the Senate try to come up with a version acceptable to both parties, as well as President Bush who has said he will veto it anyway.
Various sources, including the Solar Energy Industries Association, now report that staff within the committee have indicated the tax credit and national RPS could be taken off the Bill, as Pelosi and Reid try to make it acceptable to representatives who oppose it; an article in Fortune magazine also quoted Al Gore as saying that he had spoken to California Senator Barbara Boxer and that he "wasn’t optimistic" that tax credits would be extended by Congress.
If this turns out to be true, the RPS - variations of which have already been adopted by a number of States - and which set a target of sourcing a set amount of the US' electricity requirements from renewable resources, will no longer be in the bill. In addition, the lack of tax incentives proposed - the production tax credit (PTC) and the investment tax credit (ITC) - would be a further blow to the industry.
It isn’t just the solar industry that is up in arms about the developments. For the wind industry, the PTC is vital for the developers and manufacturers that the American Wind Energy Association (AWEA) represent. Without a long-term extension of the PTC, which expires in December 2008, developers will be unsure how financially viable their projects are. If the market starts to slow down in the USA, manufacturers could be unwilling to scale up production or enter the country at all.
Earlier this week, AWEA issued its fourth quarter market report, which showed that the industry is on track to install 4,000 MW of wind capacity, shattering the 2006 record of 2,454 MW. With long-term support, AWEA believes the industry can continue to surpass those numbers. But if the PTC is not extended, next year's installed capacity may fall short.
Those in the industry still believe that the decision to strip the bill down can be turned around in the next week — with the right public support – and everyone with an interest is being urged to get behind the campaign to reinstate the renewable energy provisions (see below).
The danger for the US is that if this latest move fails and the bill is allowed to go through minus renewable energy provisions that the industry had been hoping for, companies looking to develop their renewable portfolios in the US may choose to do it overseas; this is especially true if the tax credits don’t materialise. This would be detrimental to the US in terms of technology, competitiveness and jobs.
What can you do to help get the provisions reinstated?
|
