Today, Senate Finance Chairman Max Baucus released a tax reform discussion draft on energy which “focuses on streamlining energy tax incentives so they are more predictable and technology-neutral.”

Senator Baucus said, “Our current set of energy tax incentives is overly complex and picks winners and losers with no clear policy rationale. We need a system of energy incentives that is more predictable, rational, and technology-neutral to increase our energy security and ensure a clean and healthy environment for future generations.”

A report today said that Senator Baucus is expected to be nominated by the White House to serve as the next U.S. ambassador to China.

The discussion draft offers proposals to:

  • “Establish a new, technology-neutral tax credit for the domestic production of clean electricity
  • Establish a new, technology-neutral tax credit for the domestic production of clean transportation fuel
  • Consolidate almost all of the existing energy tax incentives into these two new credits, with appropriate transition relief
  • Provide businesses and investors with more certainty by making the new incentives long enough to be effective, but phasing them out once clearly defined goals have been met.”

A detailed summary of the energy tax reform staff discussion draft can be found here, and a one-pager on the draft can be found here.

The full staff discussion draft in legislative language can be found here.