Cleantech Industry Eyes Energy Bill Debates

A crucial bill, soon to be debated by the House, has the entire clean tech industry on tenterhooks. The 786-page energy bill is one of the top things on the House’s agenda before they go into four-week recess Monday.

The energy legislation is controversial because it could roll back nearly $16 billion in tax breaks for oil companies and provide a variety of tax incentives and other measures to boost renewable energy.

Sponsored by House Speaker Nancy Pelosi, D-Calif, the bill could give the U.S. cleantech industry a shot in the arm, but a heated debate has already ensued in the past few months. Many are skeptical about the bill and the Hill.com’s Jim Snyder defines the complications as: “ a Jenga-like quality to the delicate work of constructing national energy policy, where votes fall along regional lines as much as party affiliation,” he writes.

Ron Pernick, cleantech analyst and co-author of “The Cleantech Revolution,” says that the clean energy sector needs a boost from the federal government and in an email to Earth2Tech writes:

“Governments are now shifting their focus from conventional fossil fuels to renewable energy and efficiency. It’s already happening at the state level in places like California and Oregon and in many capital’s overseas. Now it’s the U.S. federal government’s turn to get serious or risk losing out on the next wave of technological and economic innovation.” – Ron Pernick, The Cleantech Revolution

When we talked to Andy Kruse, Co-Founder and Acting VP of Business Development and Government Affairs of small wind startup Southwest Windpower, he sounded enthusiastic about the bill, but had realistic expectations regarding how it would fare. He told us:

“There’s a lot of fingers in the energy bill. If you were to look at the solar tax incentives and small wind tax incentives, the bill would probably pass with no problem. The President has made indications that he’d sign that. Other efficiency standards could throw a road block and cause problems.” – Andy Kruse, Southwest Windpower.

As is, the bill would monetarily support existing clean energy technologies, as well as energy-efficiency projects and cleantech innovation. It also details energy-efficiency standards for the automobile and appliances industries.

Among its many sections, it contains a “Renewable Fuel Investment Capital Program,” that, as of mid-day Friday, is set to encourage venture capital investments in small clean energy enterprises and to establish a VC program, “with the mission of addressing the unmet equity investment needs of small enterprises engaged in researching, developing, manufacturing, and bringing to market renewable energy sources.”

The Bill

The energy bill is actually a collection of bills all aimed at supporting domestic clean energy production. The bills include the Energy Tax Bill (H.R. 2776), The General Energy Bill is (H.R. 3221) and a modified version of the Renewable Portfolio Standard (RPS) bill (the old H.R. 969, was filed as an amendment (#96) to H.R. 3221), explains The Oil Drum.

Already, compromises have been made in hopes of getting the bill passed. House Democrat Ed Markey put his fuel-economy proposal on the backburner. The Corporate Average Fuel Economy (CAFE) standard would have required a 35mpg average for cars and trucks by 2019.

Meanwhile, Reps. Tom Udall (D-N.M.) and Todd Platts (R-Pa.) are pushing the Renewable Portfolio Standard (RPS) amendment that would require that utilities produce 15 percent of their power from sources like wind, solar or biomass by 2022. According to The Hill, Udall and Platts were hoping for 20 percent, but “lowered it in hopes of winning more floor support.

On a state level there are opponents who are concerned that their state will not have enough renewable energy available to meet these standards, explained Mark Stout, the Manager of Community and Government Relations from solar startup Cleantech America.

While some states already have RPS’ (or RES’, Renewable Electricity Standards), which require utilities to gradually increase the portion of electricity produced from renewable resources such as wind biomas, geothermal, and solar energy, the “southeastern legislators” that have yet to pass such a bill and are “flipped out about having to catch up,” Cleantech America’s Stout told us. “States that are laggards don’t want to be held to the same standards. A state that has .5% of renewables, to them 15 to 20%, seems like an insurmountable hurdle,” Stout said.

He pointed us to non-profit the Union of Concerned Scientists, which has a graphic breakdown of states that currently have RPS:

Opponents of the bill say that by revoking tax breaks for the oil industry, the bill will actually harm our energy security. The National Review says taxes on American oil and gas companies will discourage domestic energy production and investment and send the companies overseas, and actually raise energy prices. The article also says that clean energy technologies and fuels that are supposed to replace oil, such as cellulosic ethanol, are not ready for prime time.

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