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Canary Media: The House’s Big Budget Reconciliation Bill Would Be A Bonanza For Clean Energy

Posted by Jeff St. John on Sep 12, 2021

Canary Media outlined tax credits and direct pay for clean energy, storage, and transmission in the House reconciliation bill, quoting AEE's Jeff Dennis on ITC details. Read snippets below and the full story here.

Tax credits and direct-pay provisions for a panoply of clean energy and carbon-reduction technologies. Incentives to expand and strengthen the nation’s power grids, encourage adoption of electric vehicles and electrify buildings. And a program to push U.S. utilities to make use of these technologies to reach an 80 percent carbon-free electricity supply by 2030.

These are the key energy and climate provisions in the text of the Build Back Better bill released by Democrats in the U.S. House of Representatives late last week. They’re seen as the best shot for federal policy that could deliver the emissions-reduction goals set by the Biden administration, including achieving a zero-carbon grid by 2035...

Part of the funding stream to enable the CEPP will come in the form of tax credits for carbon-free energy resources — the Investment Tax Credit and Production Tax Credit structures that have been the chief federal policy drivers for clean energy over the past two decades. More than a dozen studies agree that the U.S. must triple or quadruple the growth of wind and solar power deployment to hit the clean energy targets needed to avert the worst impacts of climate change...

Jeff Dennis, managing director and general counsel of Advanced Energy Economy, said in a Saturday Twitter thread that decoupling federal support for clean energy projects from tax equity markets will also reduce the fees collected by intermediaries to those markets, which can amount to 15 to 25 percent of the total amount of project funding...

This direct-pay structure is also built into the tax credits the bill would extend to a range of technologies that now lack access to them, Dennis added. Those include a stand-alone credit for energy storage technologies including batteries, which today must be linked to a solar project to receive the benefit.

The bill would also create an investment tax credit for transmission projects, something developers, utilities and clean energy advocates have been seeking to boost the transmission capacity needed to connect wind and solar energy to markets.

Read the full story here.

Topics: AEE In The News