Stocks in US solar and wind energy firms dipped yesterday, after the Senate again blocked plans to extend a package of renewable energy tax credits that are currently due to expire at the end of this year.
Under the Energy Independence and Tax Relief Act of 2008, tax credits on wind turbines would have been extended by one year, while similar credits on other renewable energy sources including biomass and landfill gas would have been extended for three years.
However, Republican opposition meant that a vote of 52-44 in favour fell just short of the 60 votes required for the $17.7bn package of tax breaks to proceed – the second time the bill has been blocked in the past week.
Observers said that the renewable energy tax credit had broad cross-party support, but Republican Senators denied the proposals over Democrat plans to pay for the changes by rescinding tax breaks for the oil and gas industry, closing a tax "loophole" for hedge funds and delaying a planned tax break for multinational firms.
Speaking to Forbes.com, Raymond James analyst Pavel Molchanov said that the Democrats would be likely to reach a compromise to allow the renewables tax to break through. But he warned that with the summer recess, the bill may not be finalised until after the US presidential elections in November – a situation that would introduce further investor uncertainty into the US renewables sector.
Rhone Resch, president of the Solar Energy Industries Association, warned that if the package of tax credits is allowed to lapse it will "result in the loss of billions of dollars in new investments in solar".
Massachusetts election defeat and Republican plan to block Environmental Protection Agency from regulating carbon threaten to leave the president's climate change strategy in tatters 21 Jan 2010
Row over US climate change legislation heats up as Republican Senator attempts to block EPA's right to regulate carbon emissions 13 Jan 2010Moderate Democrats and Republicans increasingly confident they can secure the 60 votes needed to pass cap-and-trade legislation 14 Dec 2009
Move met with opposition from Baucus and Inhofe 28 Oct 2009With his Senate super-majority gone, can the President continue to pursue plans for a US climate change bill? 25 Jan 2010
Resolution follows similar decision by Shell shareholders last month 09 Feb 2010
Measures needed to ensure cars do not charge from fossil fuel-powered grid 09 Feb 2010
Researchers use salicornia plants in carbon-negative process to grow biofuels 09 Feb 2010
More news
Friends of the Earth’s biofuels campaigner Kenneth Richter argues that biofuel targets are a distraction from tried-and-tested ways of reducing transport emissions 09 Feb 2010
Trewin Restorick wonders if the concept du jour of "nudging" behaviour change can help curb UK carbon emissions 08 Feb 2010
From feed in tariffs to vanishing top soil, we run down the top stories from the past week 08 Feb 2010 More in-depth
Post your comment
Send an email to the Business Green editor at feedback@businessgreen.com
