Tax Bill Largely Preserves Incentives for Wind and Solar Power

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The final text of the Republican tax bill made public Friday largely preserves key tax credits for wind and solar power and electric vehicles, reversing language in earlier versions that could have slowed the growth of renewable energy across the United States.

The last-minute changes, made as lawmakers reconciled the House and Senate versions of the tax legislation, reflect the growing political clout of the wind and solar industries, which now provide more than 7 percent of the nation’s electricity and are two of the fastest-growing energy sources.

“As wind and solar projects have soared in the U.S., in both red and blue states, so has the industry’s influence in Washington, D.C., on both sides of the aisle,” said Dan W. Reicher, director of the Center for Energy Policy and Finance at Stanford.

While some industry groups said they still had concerns about a technical change in the final bill that could negatively affect a key financing tool used for wind and solar projects, they expressed relief that most of the major incentives for renewable energy had survived the negotiations.

For years, Congress has offered tax credits for wind and solar projects that can offset 30 percent or more of the total costs. When combined with the falling costs of wind turbines and photovoltaic panels, these incentives can make new wind and solar even cheaper than running existing fossil-fuel plants in parts of the country.

The initial version of the House tax bill, passed in November, would have scaled back tax credits for wind and solar power, as well as those for electric vehicles. The wind industry had warned that those proposed changes would have eliminated over half of the new wind farms planned in the United States.

Source:  The New York Times