Late last month, Congress passed a $1.4 trillion spending package that unfortunately did not include common-sense legislation that would have moved the U.S. forward on climate action. While tax credits for land-based wind development were approved for another year, extensions for off-shore wind, solar, electric vehicles, and energy storage incentives were excluded.
This July was the hottest month ever recorded, making clear that dramatic reductions in emissions are desperately needed. That’s why it’s important that Congress renew the clean energy tax incentives. Though the clean energy tax credit extensions had widespread, bipartisan support, the lack of support from the White House ultimately slashed what would have brought significant benefits to our environment.
NYLCV and other environmental groups advocated for Congress to renew these credits because they will help combat climate change and meet renewable energy goals. Earlier in the month, NYLCV’s president penned an op-ed in Newsday urging the U.S. Senate and House of Representatives to extend these clean energy tax credits. Although this is a disappointing outcome, we are hopeful to see more extensions of these vital tax incentives in the future.
These tax incentives, like the Residential Renewable Energy Tax Credit that will expire in 2021, have proven to be an effective measure in promoting wind, solar, geothermal and other energy-efficient technologies in the U.S. The credits can be applied when installing solar panels on homes or geothermal heat pumps, for example. If you’re interested in applying for the credits, you can follow this step by step guide. Taxpayers can save up to 30% through certain credits by switching from traditional energy renewable technology, while also supporting the growth of green energy. Be sure to check if you qualify.
The first of these incentives were issued in the 1970s during the Carter administration to promote clean energy and reduce U.S. reliance on oil and gas. With more enacted over time, the incentives helped make significant progress in nationwide emission reductions, with more projected if the tax incentives are extended. It is estimated that the pollution reduced as a result of extending these tax credits would be comparable to the pollution emitted by 93 coal plants. By incorporating more green energy in residential homes and businesses, we can move towards a more sustainable and clean energy future.
Alongside the environmental benefits, there are also numerous economic advantages to these credits. Associated tax credits of solar power helped create 242,000 U.S jobs, and wind tax credits helped create 114,000 jobs. A study by Wood Mackenzie Power & Renewables found that, cumulatively, the clean energy tax incentives have generated $87 billion in economic activity.
The federal tax incentives also advance the United States’ original promise in the Paris Climate Agreement to curb emissions by 25% before 2025. Though President Trump initiated the withdrawal of the country from the agreement, this should not impede efforts to continue to reduce our fossil fuel reliance.
According to a recent study done by the Global Strategy Group, Americans and New Yorkers were in overwhelming support of extending the federal tax incentives. Across the country, 89% of voters are in agreement on this and believe tax incentives to be beneficial for the economy, public health, and above all, battling climate change.
NYLCV will continue to advocate for clean energy and urge Congress to extend the incentives early in 2020. You can show your support by sending a message to your Senator or Representative here.