Last week I fled the snowstorms of Colorado for the spring
cherry blossoms in Washington DC to lobby Congress on energy tax reform as part
of the Advanced Energy Economy’s (AEE) first regional chapter fly-in. Companies and clean energy
organizations from all over the country converged in DC to talk to House Ways
and Means and Senate Finance Committee Members of Congress and senior
staff. We had companies and
associations from North Carolina, Arkansas, Boston, Michigan, California,
Maryland, Minnesota and more. Ed
Williams, the CEO of Novinda, was the industry advocate rounding out CCIA’s
team.
Despite the historic gridlock in Congress there is a real
bipartisan push to reform the tax code.
One message nobody disagreed with is that our current tax policy is
broken and because we don’t have a national energy policy, energy tax policy is
the driving force for cleantech.
The overall theme of our message was promoting a smarter tax
policy - one that is technology neutral, outcomes based and sunsets when a
particular goal is met.
Unfortunately, the various tax policies benefitting cleantech are composed
of one, two and five year sunsets and reauthorizations that combine to create
artificial cliffs prohibiting planning and investment. We need to look no further than the recent brinksmanship and
damage done by the recent one-year extension of the wind PTC. Instead of a one-year extension of the
wind PTC, Congress needs to set a goal - like 5% of our baseload electrical
energy from wind or X amount of gigawatts deployed, then the tax benefit
sunsets.
Another example I used was in the transportation
sector. Congress should set a goal
to reduce foreign imported oil for transportation and any domestic technology
(electric vehicles, natural gas vehicles, advanced engine efficiencies,
biofuels, more transit etc.) that helps to accomplish the goal gets a tax
incentive. When the goal is
achieved then the tax break goes away. This is especially important in the current context of many
traditional energy industries getting tax breaks baked into our tax code with
no sunset provisions. The current
tax system picks winners and losers and distorts markets thereby decreasing and
sometimes flat-out discouraging investment in new innovative technologies.
Democratic and Republican members were impressed that a
group came to DC not asking for a handout and volunteering for a sunset to a
potential tax provision benefitting their industry. This message especially resonated with Senate Majority
Leader Harry Reid’s staff and Energy Committee Ranking Member Senator Lisa
Murkowski’s staff.
While this was more of a 30,000-foot discussion on energy
tax policy, if tax reform bogs down again in the DC swamp then cleantech needs
to be prepared to fight for specific provisions in another temporary tax
extenders package. This is of
course if we can walk and chew gum at the same time. I’m confident CCIA, AEE and its members can do just that.
Chris Votoupal
Deputy Director
CCIA