The Senate renewed a $17 billion tax credit that benefits renewable energy developers, a piece of legislation that environmental and energy advocates have said is fundamental to weening the nation off foreign oil and fossil fuels. The House and Senate still have to reconcile spending bills before the tax breaks, and President Bush sign off on it, before they become law.
The tax break alone won't achieve such far-reaching results, but without it, even stepwise investments in that new energy future would have been undercut. A bonus: The bill also includes tax credits for consumers to encourage purchases of energy efficient appliances, homes, buildings and plug-in hybrid vehicles.
Unfortunately, Congress is still flirting with -- and apparently getting serious about -- ending the offshore oil drilling ban, and the Senate's bill also includes "incentives for dirty, destructive, and costly oil shale, liquid coal, and tar sands," according to the Sierra Club. So lawmakers are still passing a scatter-shot energy policy.
Still, the Senate bill is a big improvement over existing tax credits, because it extends for eight years, rather than one or two, as has been the case recently. That lets investors make longterm bets on the high upfront costs of building new solar, wind or other renewable energy projects. Over time, these projects can pay for themselves, but it takes capital to get them off the ground.
Capital... Of course, that's in short supply, with the U.S. financial system in crisis.
Our friends over at Grist.org had this worthy summary of how environmental thinkers have reacted so far to the crisis and the Bush Administration's bail out:
Enviros are starting to weigh in on the Bush administration's proposed $700 billion bailout for Wall Street. Friends of the Earth President Brent Blackwelder bashed the plan yesterday, arguing that "the right wing's anti-regulation philosophy ... has resulted in greedy corporate titans getting rich on the backs of working people. This same philosophy is causing irreparable harm to the planet." Blogger John McGrath writes, "Instead of the trillion dollars that it's now estimated the U.S. is going to spend getting out of this mess, how about we let Wall Street burn and spend that money rebuilding [and greening] the actual economy?"
Sierra Club Executive Director Carl Pope points out that $700 billion "is roughly equal to this year's bill for imported oil. So if we really took ending our addiction to oil seriously, we could repay the Treasury for the bailout." Grist's David Roberts notes that at the current rate of U.S. government spending on renewables, $750 billion could pay for 375 years of renewable R&D. Joseph Romm of the Center for American Progress asks whether the financial crisis is more dire than the climate crisis, and then answers his own question: "Not even close." In a different vein, Adam Stein of TerraPass argues that "the 'let Wall Street burn' approach won't do anybody any good, least of all the environment."
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