Renewable Tax Credits Extended as Part of Bailout Bill

By ClimateBiz Staff
Published October 3, 2008

Renewable Energy

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WASHINGTON, D.C. -- The renewable energy tax credits received a new lease on life when the breaks were added to the $700 billion bailout plan passed by the House Friday.

The Senate gave the bill a nod Wednesday. President George Bush signed the legislation about an hour after it passed in the House.

About $110 billion in tax breaks and other sweeteners for individuals and businesses were added to the final bill to guarantee its passage after a trimmer version was defeated by the House Monday.

The renewable energy tax breaks ring in at about $18 billion. It includes a one-year extension for wind energy credits and eight year extension of credits for businesses and homeowners who install solar energy generating systems. Plug-in electric car buyers would also see a tax break.

"If it passes, this would complete the mainstreaming of solar energy in the U.S.," John Berger, Standard Renewable Energy CEO, told Forbes this week. Berger predicted the tax credits could help quintuple his solar business within a year.

But the provision isn't restricted to clean fuels. It would give $900 million to refineries for retrofits to process dirtier oils from shales and tar sands, Reuters reported. About $2.55 billion would be spent on clean coal projects.

The federal renewable energy tax credits were set to expire at the end of the year. Both chambers of Congress approved separate bills last week extending the credits but couldn't agree on how to pay for them.