Tax Bill Could Dramatically Slash Renewable Energy Incentives

For better or worse, the pending Senate and House Bills will have a monumental impact on renewable energy. The House version proposes more draconian cuts, but even the Senate edition – which largely protects renewable energy – could trim clean energy investments.

The controversial legislation proposes the largest corporate tax cut in American history – again, for better or worse – while also allowing for drilling in the Arctic National Wildlife Refuge and shrinking a host of renewable energy programs.

Inside Climate News has the scoop.

While the Senate version is generally friendly to renewable energy, it also introduces the Base Erosion Anti-Abuse Tax, which applies a 100% tax on tax credits earned by companies with overseas operations. This would drastically impact the clean energy sector.

"The tax equity marketplace would collapse under these provisions, leading to a dramatic reduction in wind and solar energy investment and development," notes a letter sent to the Senate by clean energy groups.

The House version of the tax bill impacts renewable energy more directly.

For one, it slashes the tax credit for homeowners installing solar arrays to 0 by 2021 and to 10% for solar developers (which, itself, goes to 0 by 2027). It also cuts the wind developer Production Tax Credit – which runs through 2019 – from 2.3 cents per kilowatt-hour to 1.5 cents. The House Bill also eliminates the $7,500 electric vehicle tax credit, altogether.

The House and Senate are currently working to reconcile their versions of the tax bill, so the fate of renewable energy is unknown. And both iterations have their pros and cons (plus a mountain of supporters on each side).

Read more here: https://insideclimatenews.org/news/04122017/senate-tax-bill-renewable-energy-credits-solar-wind-electric-vehicles-anwr