Washington (Platts)--23Sep2008

The White House Tuesday came out in support of "prompt passage" of a Senate
amendment that would extend a series of tax credits for renewable energy, but
urged Congress to remove provisions that use the oil and gas industry to pay
for the extension.

The Bush administration said it "remains strongly opposed" to provisions
that would freeze the domestic production deduction for oil and gas, change
the tax treatment of US oil companies that receive foreign income and
eliminate the cap on the oil spill liability trust fund.

"These provisions will increase the costs of American oil production,
will give further advantages to foreign suppliers and will likely result in
higher prices at the pump," the White House said in a statement of
administration policy on the Senate amendments to HR 6049, an energy tax bill
passed earlier by the House of Representatives. "The administration urges
Congress to eliminate all such provisions from the final bill."

The Senate is poised to vote on three amendments to HR 6049 later Tuesday
before casting a final vote to send the bill back to the House for
consideration. The first vote is expected to be on the tax incentives for
renewable energy, the second on an amendment deals with the alternative
minimum tax and the third on an amendment that would extend business tax
credits.

Senate Democratic and Republican leaders support the energy tax package
with its budget offsets and the amendment is expected to attract the 60 votes
needed to avoid a filibuster.

Key provisions would install an eight-year extension of federal
investment tax credits for solar energy, a one-year extension of the
production tax credit for wind and refined coal and a two-year extension of
that credit for other sources including new biomass and marine renewables.

The Senate amendment also would provide $1.5 billion in tax credits for
advanced coal and gasification projects that demonstrate carbon capture and
sequestration, credits for plug-in electric vehicles and extension of the $1
per gallon production tax credit for biodiesel and fro diesel created from
biomass through 2009.

--Cathy Cash, cathy_cash@platts.com