Lame Duck Session Controls Momentum of Renewable Energy Industry

A Renewable Energy World

Photo Credit: Image by Taylor Dundee via Flickr

Renewable Energy installers in the U.S. and Ohio are holding their breath as the U.S. and Ohio Senate consider incentives that will greatly impact the renewable energy industry. On the federal level, Senate Majority Leader Harry Reid (D-Nev.) unveiled a bipartisan tax package bill Thursday evening that includes an extension of the Section 1603 cash grant giving renewable energy investors a 30 percent investment tax credit on qualified project costs.

In Ohio, the House passed Rep. Mike Foley's (D-Cleve.) sponsored bill HB 301, that extends the Advanced Energy Fund for three years, a grant program that is vital to the future of distributed generation projects in the state.

The 1603 Treasury Grant Program is necessary to help level the playing field between the fossil fuel industry and renewables. Since the fossil fuel industry is so highly subsidized by the federal government, it is impossible for solar, wind and other renewable industries to compete without incentives. If Section 1603, found in the American Recovery and Reinvestment Act, is not renewed it will greatly reduce the number of renewable energy projects installed in the U.S. and put us further behind other nations in the manufacturing of renewable energy technologies and commitment to reducing carbon emissions. According to the American Wind Energy Association (AWEA), failure to extend the 1603 program could cost the U.S. 15,000 renewable energy jobs.

There is no doubt the investment tax credit has been a vital part to boosting the renewable energy industry in the U.S. According to SolarNation, Section 1603 has allowed the solar industry to grow by more than 100 percent in 2010, created enough solar capacity to power 200,000 homes and doubled domestic solar employment to more than 93,000 Americans. AWEA says that the grant program enabled the construction of 10,000 MW of new wind capacity in 2009--more than double the 4,000 MW that would have been installed without the program, and saved 40,000 jobs in construction, manufacturing, and research and development.

Ohio's Advanced Energy Fund has invested more than $50 million in some 620 advanced energy projects across Ohio, including the installation of Cleveland's first business-owned wind turbine which was the impetus for the passage of wind turbine zoning legislation in the city. This grant gets its funding through a uniform fee of .09¢ per month on electric bills of customers of the state's four investor-owned utilities--American Electric Power, Dayton Power & Light, Duke Energy and FirstEnergy. Now, the future of this incentive is in the hands of the Ohio senate with an unlikely chance of passing. The week ahead will dictate the fate of this grant and the future of Ohio's renewable energy industry.

The passage of Gov. Ted Strickland's energy bill in April 2008 ignited the renewable energy industry in Ohio. Included in this bipartisan legislation was a Renewable Portfolio Standard mandating that 25 percent of electricity generated in Ohio come from advanced energy sources by 2025 with 12.5 percent from renewables including hydro and 50 percent of that power generation coming from Ohio projects. This lame duck session will give Ohioans an idea of what to expect in the year's to come with a republican majority in the house and senate. Hopefully Ohio's Republican Governor-elect John Kasich will continue the leadership necessary to make Ohio a world-class leader in green energy jobs and manufacturing, and promote a sustainable energy economy.

Deployment of renewable energy projects is uncertain. If Section 1603 and Ohio's Advanced Energy Fund get renewed, at least we will know our country is headed in the right direction. Success of these measures will take a lot of effort over the next two weeks. Calls and emails are needed to the U.S. and Ohio senate encouraging passage of these incentives to support the transition to cleaner sources of power and strengthening of our green economy. Contact your U.S. senators and Ohio senators. Your voice makes a difference.