Congress' plan to add renewable energy riders to a multi-year Federal Aviation Administration bill is a bad idea, critics say.
A coalition of more than two dozen conservative groups, led by Americans for Prosperity, sent a letter Tuesday pressing congressional leaders to block efforts to add incentives for renewable energy projects to a six-year FAA reauthorization bill.
But those are fighting words for the renewable energy industry. The ethanol industry is leading a coalition of biofuel groups in a counter-effort, prodding House and Senate leaders in its own letter to make extensions of tax incentives a priority and to act soon.
"Unfortunately, these provisions are already set to expire at the end of 2016," the renewable fuel groups said in their letter. "However, as Congress works on developing energy tax extenders legislation, we urge you to ensure that advanced biofuels are part of the package. Extending some 2016 expiring energy tax provisions and not others creates a piecemeal approach and investment uncertainty across the energy sector and distorts the playing field for biofuel producers."
But the conservative groups say Congress already did enough by extending a number of incentives for renewables in December's omnibus spending bill. Those that were left to expire should do so, the letter says.
"Congress considered the matter of expiring tax provisions less than four months ago," the letter to Senate Finance Committee Chairman Orrin Hatch, R-Utah, and top Democrat Ron Wyden of Oregon, reads. "The $680 billion package signed into law in December made some of these items permanent and allowed more than two dozen others to expire at the end of this past year, laying the groundwork for comprehensive tax reform."
The $1.4 billion in expiring tax provisions under consideration in the reauthorization bill are "a distortion of the tax laws for special interests in the renewable energy industry and were wisely left out of this package." The tax credits pertain to a number of energy resources, including: wind power, geothermal heat pumps, hydrogen-powered fuel cell facilities, and renewable fuels.
More details on the timing of the FAA bill is expected later the week as the Senate returns to work.
The renewable fuel groups are looking for the extension of at least five tax credits "as a part of any energy tax package," the coalition letter reads. "We ask that you move quickly to extend these provisions ahead of the expiration date to avoid creating uncertainty for investors and companies trying to raise capital. We look forward to working with you on this important matter."