Washington (Platts)--16Jan2009

Renewable energy advocates said Friday they were optimistic about what an
upcoming economic stimulus bill will do for their industry.

Wind, solar and other renewable producers have found it difficult to nail
down financing for new projects in the face of tightening credit markets.

A group of renewable advocates met Wednesday with members of President-
elect Barack Obama's transmission team. At the meeting, a variety of measures
were discussed to help the industries, a renewable energy advocate said.

"Right now, capitol markets are in a shambles," said the advocate, who
declined to be named. This situation is leading to the cancellation of some
new projects that did not secure financing before markets declined.

The advocate said that making tax credits refundable to producers, a
proposal supported strongly by renewable groups including the American Wind
Energy Association, was "off the table," but US Senate, House of
Representatives and administration negotiators were offering a suite of other
policy changes, the advocate said.

The Ways and Means Committee, which produces tax policy in the House,
announced Thursday that it would provide a three-year extension of the
production tax credit. This would mean the credit for wind energy would expire
in 2012, while incentives for geothermal and other industries will remain in
place through 2013.

Ways and Means also has said its stimulus bill would allow developers to
temporarily choose an investment tax credit over a PTC. The panel's summary
also mentions a new US Department of Energy grant program and the renewable
energy advocate said that the Obama team proposed a fund to cover the cost of
projects for a year or two until credit markets improved.

Monique Hannis, a spokeswoman for the Solar Energy Industries
Association, called the proposed program "promising."

Members of the incoming administration have also proposed loosening the
rules for an existing DOE loan guarantee program authorized under the Energy
Policy Act of 2005, which currently guarantees only experimental technologies
but could be extended to benefit commercial wind, solar, and other projects.

"That would be huge," said the advocate.

The House Appropriations Committee Thursday released its stimulus
spending bill, which would provide $1 billion for additional loan guarantees
for advanced battery technologies and $8 billion for DOE's renewable energy
loan guarantee program.

It was unclear whether commercial nuclear and clean coal projects would
also benefit from this change.

House and Senate tax writers are expected to release their proposals as
soon as Friday.

--Jean Chemnick, jean_chemnick@platts.com