The Investment Tax Credit discussions are heating up. We brought you the opinions of two notable solar CEOs last week to broaden the perspective, and now we bring you the most recent comments from Rhone Resch, president and CEO of the Solar Energy Industries Association (SEIA). Resch sent out an email last week with both the good and bad news about the quest to extend the ITC:
Right now, there are two possible paths forward based on published reports and our own intelligence gathering efforts.
One is a roughly $800 billion tax extenders package. Negotiations among Congressional leaders and the White House continue over a potential deal that could make some provisions permanent and extend others on a temporary basis.
This year, the House has approved bills to make permanent the Research and Development (R&D) credit, the election to deduct state and local sales taxes and packages of charitable and small business provisions. The House Ways and Means Committee passed bills to make additional provisions permanent, including bonus depreciation, the Subpart F exemption for active financing income, the Controlled Foreign Corporations (CFC) look-through rule and the 15-year recovery period for qualified leasehold improvement property, qualified restaurant property and qualified retail improvement property.
The Obama administration is seeking to make permanent expansions of the Child Tax Credit and Earned Income Tax Credit that expire at the end of 2017, and Democrats have additionally proposed indexing the Child Tax Credit for inflation. Republicans are insisting on new compliance provisions to help prevent fraud as a condition for addressing the expansions of the credits.
If some of these larger issues get resolved, we believe that Congress will include a meaningful expansion of the ITC. Details have not been finalized, but the options range from a multi-year extension of the ITC, to a possible ramp down over time, to just inclusion of the commence construction change.
A second possible legislative vehicle is a tie in with legislation lifting the current ban on crude oil exports from the U.S. We are working closely with our champions to extract the best possible deal for the ITC if that scenario unfolds.
But here is the troubling part.
There is now an unholy alliance of electric utilities, a CEO of a solar company that is funded by fossil fuel money, and other fossil fuel interests with the intent of blocking even the slightest of advances for solar energy on Capitol Hill.
We know that the Edison Electric Institute, with some of its bigger members, have been on Capitol Hill lobbying members of Congress to block the inclusion of commence construction for solar, even as some of its members have paid lip service to clean energy.
At the same time, Sunnova’s CEO has been in Washington on a well-funded press and lobbying junket to block the ITC. Sunnova is a wolf in sheep’s clothing, with most of its board of directors and investors coming from the fossil fuel industry.
Finally, other fossil fuel interests are working to block any effort to extend the ITC as part of the legislation to lift the oil export ban.
Be assured that we are taking diligent steps to address these issues on a multitude of fronts. Look for regular ITC updates, and know that we will not stand for getting lumps of coal in our stockings this year.