With the lame duck session in full swing, fiscal cliff negotiations are ongoing, but slow moving, and energy issues are stuck in the middle of the fight.
Though many are hopeful that the expiring wind production tax credit will be extended, Senator Chuck Grassley (R-IA) said November 28 that the fight now has more to do with saving the credit than with which version of the extension should prevail. Multiple versions of an extension are pending in Congress. Senator Grassley has proposed a stand-alone measure, the American Energy and Job Promotion Act (S. 2201), to extend the program for two years, while the Senate Finance Committee approved in August a tax extension measure, the Family and Business Tax Cut Certainty Act (S. 3521) to extend and expand the program. Legislation extending the credit has also been introduced in the House, but has not advanced.
The North American Association of Insulation Manufacturers sent letters to House and Senate leadership November 29 urging them to extend the 25C home retrofit credit and the 45L energy efficient new home credit as part of the tax extenders negotiation. Both credits expired at the end of 2011, but were included in the Finance Committee’s August package.
Smart Growth America asked Congress November 19 to pass a tax incentive, Section 198, by the end of the year to encourage brownfields development. Extending the incentive through fiscal year 2013 would allow for greater expenditure in brownfields development and maintain existing momentum; the brownfields tax incentive was created as part of the Taxpayer Relief Act of 1997.
After receiving significant attention in the media a couple of weeks ago, policymakers continue to voice their opinion over whether a carbon tax has a place in the fiscal cliff negotiations. Senator Lisa Murkowski (R-AK) said November 28 that a carbon tax has little political momentum as this moment, while a group of more than 100 companies, including Shell and BP, signed the Carbon Price Communique November 20 encouraging Congress and the Administration to put a clear price on carbon emissions.
Senator David Vitter (R-LA) and Representative Mike Pompeo (R-KS) said November 29 that they plan to introduce a concurrent resolution this week stating that a carbon tax is not in the economic interest of the United States. Senate Majority Leader Harry Reid’s (D-NV) office said that the resolution will not get a vote in the Senate.
As part of the Defense authorization negotiations, the Senate approved, 62-37, an amendment from Senator Mark Udall (D-CO) November 28 to the National Defense Authorization Act for Fiscal Year 2013 (S. 3254) that removed a provision that would have prohibited the Defense Department from producing or procuring biofuels if the cost exceeds the price of traditional fossil fuel. One of the Pentagon’s energy goals includes having the Navy derive 50 percent of its total energy from alternative sources by 2020 and having the Air Force obtain half of the fuel it uses for domestic flights from alternative sources by 2016. The Senate also approved an amendment from Senator Kay Hagan (D-NC) to strike a provision hat would prohibit the Pentagon from entering into a contract to plan, design, or construct a biofuel refinery unless specifically authorized by law. It is unclear when the bill will come to a vote on final passage.
House and Senate farm bill leaders joined Agriculture Secretary Tom Vilsack last week in a last ditch effort to put in place a new five-year plan before the end of this Congress, though it is quite likely that an agreement is not worked out until next year. The Farm Bill includes an energy title.