Wind, Biofuel Win, Solar and Electric Vehicles Lose in Year-End Appropriations

Published January 29, 2020

Supporters of extending a slew of tax credits for green energy technologies had to settle for considerably less than they lobbied for in the omnibus appropriations measure passed before Congress adjourned in December.

The eight-bill package funding federal government operations through September 30 of this year was signed into law by President Donald Trump on December 20.

When the smoke cleared, only two green energy tax breaks emerged unscathed: the wind production tax credit (PTC) was extended for an additional year, and the biodiesel tax credit was renewed retroactively to 2017 and extended to 2022.

Media reports say opposition from Trump blocked the extension of an assortment of subsidies and tax credits for carbon capture and sequestration, electric vehicles (EVs), energy storage, offshore wind, and solar investments.

Biodiesel, Onshore Wind Win         

Biodiesel emerged a winner in end-of-year funding negotiations. A biodiesel tax credit, which had previously lapsed, was renewed.

The $7,500 tax credit for purchasers of new EVs did not make the cut. Media reports indicate Trump threatened to veto the entire package if the EV tax break was included.

The land-based wind PTC, currently 1.5 cents per kilowatt-hour of electricity produced, has been extended several times since it was enacted in 1992. It was due to phase out completely in 2020, but Congress extended it another year. Despite intense lobbying, Congress did not extend tax credits for solar and offshore wind projects.

Congress is following the lead of other countries in reining in green energy subsidies, says David Wojick, director of the Climate Change Debate Education Project.

 “America is not alone here, with most major economies cutting back, saying enough is enough,” said Wojick. “Governments are increasingly saying, ‘Let these shaky technologies stand or fall on their own.'”

‘Should Be the Last’

It is time Congress stopped forcing taxpayers to prop up the wind industry, says Craig Rucker, president of the Committee for a Constructive Tomorrow (CFACT).

“Wind energy has received government support of one type or another since 1978 during the Carter administration,” Rucker said. “That means U.S. taxpayers have been propping up wind energy for 42 years.

“The one-year extension of the tax credit the wind industry just got should be the last taxpayer handout it ever gets,” said Rucker.

Bonner R. Cohen, Ph.D. ([email protected]) is a senior fellow at the National Center for Public Policy Research and a senior policy analyst with CFACT.