But, there is also a story about the continued imbalance in our system that favors the old, polluting technology of the past over the clean energy choices of today and the future.
This imbalance is more than a graph with numbers.
This imbalance has real-world consequences that have already led to economic opportunity loss to other countries.
The most tangible example is the recent news that Gamesa, a giant in the wind industry, announced they would be installing an offshore wind prototype in the Spanish Canary Islands, rather than off the shores of Virginia.
From the Richmond-Times Dispatch: Wind giant snubs Va. for offshore prototype
Global wind giant Gamesa said today it will build a wind turbine prototype in the Spanish Canary Islands instead of Virginia, citing the sluggish pace of U.S. development of offshore winds.
The Spanish company won Virginia regulatory approval in March to construct the 479-foot, 5-megawatt wind turbine prototype off the Eastern Shore. It was viewed as a significant step by the wind technology company to help develop the nascent U.S. wind industry, especially in waters off Virginia.
….
[A] Gamesa spokeswoman said the slow pace of regulatory actions, uncertainty over the future of tax credits for offshore development and the lack of a federal energy policy all conspired against investment in the prototype. (link added)
How Congress can act to fund the solution, not the problem
The signs of climate change, fueled by our continued reliance on carbon-polluting energy, are increasing in urgency. The economic, ecological and even psychological damages are being felt across the country.
While there is little sign that Congress will take significant action this year to significantly change the tide on energy policy, there is opportunity for policymakers in Washington to take important steps to keep current clean energy incentives going while looking at options to cut wasteful, environmentally harmful spending.
Clean Energy Tax Credits that Require Action in 2012
Unlike fossil fuel subsidies that are embedded in the tax code, these clean energy incentives need to be re-authorized from time-to-time and many have recently expired or are set to expire by the end of the year if Congress doesn’t take action.
- Section 48 Investment Tax Credit (ITC) for Offshore Wind Energy. Offshore wind energy represents a huge untapped resource that stands to generate clean electricity and increase manufacturing jobs for the future of the nation. There are still, however, no operating offshore wind facilities in U.S. waters. Section 48 should be extended for offshore wind facilities and bi-partisan legislation has been introduced in the House and Senate to do so.
- Section 45 Renewable Energy Production Tax Credit (PTC) . This provision has been a critical tool to support investments in renewable energy. The credit expires at the end of 2012, but uncertainty on whether Congress will act has already resulted in a sharp drop in investments in wind energy production, threatening the livelihoods of the more than 78,000 people in nearly every state in the nation who are now in wind-supported jobs. When Congress allowed the PTC to expire in the past, wind installations dropped between 73 and 93 percent.
- Tax Credits for Energy Efficient Homes & Appliances. The Section 45L Efficient New Homes Tax Credit & Section 45M Efficient Appliances Manufacturer Tax Credit expired at the end of 2011. These tax credits not only save consumers and homeowners money by promoting energy efficient appliances and home energy products, but also create jobs. These credits encourage domestic manufacturing of high-efficiency appliances and jobs installing home efficiency projects that cannot be exported.
- Section 48C Advanced Energy Manufacturing Tax Credit. This program leveraged vital private investments in new, expanded, or re-equipped clean energy manufacturing projects throughout the country. With applicants far exceeding the program’s original allocation, the program was able to leverage $5.4 billion in private investment, boosting growth and creating thousands of new U.S. manufacturing jobs for the burgeoning global renewable energy industry. Congress must pass an additional allocation for 48C, so that we can continue to grow our domestic renewable energy industry from the beginning to the end of the supply chain.
- Section 1603 Treasury Grant Program for Renewable Energy Projects. Section 1603 has played a vital role in renewable energy deployment and expired at the end of last year. The program has leveraged over $22.8 billion in private sector investment to support over 2,000 projects representing over a dozen clean energy industries in all 50 states. According to a study by the U.S. Partnership for Renewable Energy Finance (a non-partisan educational program for policymakers), the Section 1603 program has generated over 115,000 jobs since it was enacted.
- Section 30B(d)(2)(B) Credits for Hybrid Medium- and Heavy-Duty Trucks. Medium and heavy duty vehicles are second only to automobiles in oil consumption and they are responsible for 20 percent of U.S. transportation-based greenhouse gas emissions. Hybrid and electric drives can increase fuel efficiency in trucks from 20 to more than 50 percent, yet the incentives for producing and deploying them expired in 2009. These incentives will help accelerate the development and deployment of more efficient and cleaner vehicles and help create domestic jobs.
Learn more about NWF’s efforts to promote clean energy that protects wildlife for our children’s future and what you can do to help.
Building in floodplains is very bad for salmon (and lots of other wildlife). It takes away the habitat they need to survive. And that is bad for people. It also puts people in harm’s way when the floods come. And in the Pacific Northwest, more floods are coming all the time because of changing weather patterns caused by climate change.
Unfortunately, the Federal Emergency Management Agency (FEMA) encourages construction in floodplains by offering artificially low-cost flood insurance. They undercut the private insurance industry and spend our tax dollars to make it cheaper for businesses to build in places that destroy the Northwest’s ecology and fish. It is plain and simple goofy.
To read more or to hear NWF floodplains expert Dan Siemann discuss the issue in the state of Washington on the radio, check out this story. Or see our webpage. And if you are wondering whether this story applies to where you live: heck yes it does. FEMA subsidizes construction in floodplains around the country even while the federal agencies charged with protecting the environment tell us it is a terrible idea.
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Read the play-by-play on yesterday’s hearing from NWF’s Tony Iallonardo.
As we continue to pump taxpayer dollars back into the pockets of some of the richest corporations in America, the Senate is expected to vote next week on a plan to end the Big Oil Boondoggle.
The bill, sponsored by Senator Menendez (D-NJ) and cosponsored by 28 of his colleagues, will eliminate nearly $21 billion in subsidies to the largest oil companies over the next 10 years and put that money to deficit reduction. This bill is a step in the right direction, but it leaves billions of wasteful dirty energy tax breaks on books: going after all $4 billion in oil and gas tax breaks, coal subsidies, and incentives to produce environmentally-destructive corn ethanol. Money that could not only help ease budget pressures, but could be put to use on research, development and deployment technology to reduce dependence on fossil fuels and protect wildlife and the natural ecosystems upon which communities depend.
Budget Deal on the Horizon?
Prospects for passage in the Senate are slim and even less optimistic in the House, where proposals to end tax breaks have been rejected. While the current legislation may not make it to the President’s desk, the issue is not going away. Government spending and deficit reduction continues to remain at the top of the agenda in Washington, D.C. and both Democrats and Republicans have indicated support for ending tax breaks to oil companies in the name of getting our fiscal house in order, opening a door to a deal on ending the subsidies.
Take Action! Tell Congress to end handouts to Big Oil.
The nation narrowly escaped a budget collision and government shutdown a few weeks ago, but that was just the opening round in the epic battle to rein in out of control deficits in Washington. While conservation and public health protection bear the brunt of the attack, the oil and gas industry has escaped the guillotine ensuring that pollution and profit at the expense of American households will continue unabated.
Enshrined for too long in our tax code, oil and gas tax loopholes and high profits add “salt to the wounds” for families who are paying almost $4.00 a gallon for gasoline to fuel their cars, up over $1.00 from last year. Even the former CEO of Shell Oil, John Hoffmeister, recently admitted that Big Oil doesn’t need subsidies.
Voters agree; a February ABC News/Wall Street Journal poll found that 74 percent of voters support eliminating tax breaks to oil companies.
Unbalanced Priorities
While fossil fuels continue to enjoy legacy subsidies, renewable energy struggles to compete in an unbalanced system. In a comprehensive study of government support for energy, fossil fuels enjoyed a 5 to 1 advantage in government backing over renewable energy.
If Congress was serious about solutions to increasing gas prices, it would end wasteful spending on false solutions and instead direct investment to real, clean solutions such as an efficient transportation system, electric vehicles, and next-generation bioenergy.
Will Congress Get it Right?
Prior to the current price-hike and profit reports, both the House and Senate voted-down proposals to end the wasteful spending earlier this year. In February, Senator Carl Levin (D-MI) sponsored an amendment to end tax breaks for Big Oil. The proposal failed 44-54, with 7 Democrats joining all Republicans in opposing the measure. In the House, while debating a stop-gap government funding measure, 249 Members stood with Big Oil and voted against eliminating oil & gas subsidies.
Congress may have another chance to rectify the situation.
Senate Majority Leader Harry Reid has pledged to hold a vote soon after the Congressional recess to cut-off the nearly $4 billion taxpayer boondoggle benefiting Big Oil and Finance Committee Chairman Max Baucus (D-MT) has announced a plan to repeal oil and gas tax breaks while investing in clean energy solutions. According to details released by the Chairman, the “Clean, Affordable Energy Production Plan” would:
- Repeal tax breaks for the largest oil and gas companies – end tax incentives for the five largest oil and gas companies that announced tens of billions of dollars in first quarter profits this week. This includes the elimination of the section 199 manufacturing deduction, reduction in the foreign tax credit for royalty payments to foreign governments and the imposition of an excise tax on certain Gulf leases.
- Promote demand for clean, domestic fuel – encourage increased production of cleaner and more affordable domestically-produced fuel by making it easier for manufacturers to produce and for consumers to purchase.
- Incentivize fuel efficient vehicles – increase demand for the most fuel efficient vehicles by providing incentives for the purchase of these vehicles and encouraging manufacturers to increase production.
- Build a clean energy infrastructure – incentivize the infrastructure needed to support clean energy vehicles, such as alternative energy fueling stations, that will make the clean energy transportation of the future possible.
House Minority Leader Nancy Pelosi, Congressman Early Blumenauer, and other House Democrats have also asked for a vote on ending Big Oil tax breaks. Although indicating he may be in favor of such a move, Speaker Boehner has since recanted and continues his backing of Big Oil profits. Meanwhile, House Budget Chairman Paul Ryan (R-WI) has recently expressed support for ending Big Oil subsidies, a potential opening for such reform in the upcoming budget negotiations.
President Obama is putting the weight of the White House behind this effort, calling on Congress to invest in clean energy “instead of continuing to subsidize yesterday’s energy sources”.
Now is the time to invest in real energy solutions that truly reduce our dependence on foreign oil while creating homegrown American jobs.