This is the House's version of the larger, so-called Corporate Tax Bill whose underling purpose is designed to bring about the lifting of European Union trade sanctions on some U.S. products by repealing an export tax break that has been ruled a violation of World Trade Organization rules. As is often the case with Washington legislative practices, numerous other measures were added to the bill, including this PTC extension and expansion.
House and Senate Conferees reached agreement on the bill Wednesday, and congressional leaders hope to complete action on it before adjourning at the end of the week. The PTC provides a 1.5 cent-per-kWh tax credit (adjusted annually for inflation) for electricity generated from new facilities.
Geothermal power currently provides 6 percent of California's electricity production, according to GEA. With this new incentive, by the year 2025, geothermal power could provide 6 percent of total U.S. electricity or about as much as conventional hydropower generates today.
The PTC was also expanded to solar, and open-loop biomass. The expansion will be great for geothermal and open-loop biomass, but not particularly useful for solar, according to Colin Murchie, Director of Government Affairs for the Solar Energy Industries Association. This is because the legislative is written as such that a company cannot take both the 10 percent investment tax credit and the PTC. SEIA is concerned that a residential tax credit for solar energy systems is not likely to make to the final version of the bill.
