Democrat Releases Energy Plan as Alternative to Biden Outline

Biden plan would prioritize no-carbon energy sources Wyden proposes eliminating tax breaks for fossil fuels

Senate Finace Chairman - Ron Wyden -EnergyNewsBeat

Senate Finance Chairman Ron Wyden proposed ending existing tax breaks for fossil fuels and creating new incentives for low-and-no carbon energy sources that he said would prune the existing “hodgepodge” of energy tax benefits.

Wyden’s plan, which he introduced Wednesday, would offer an alternative approach to President Joe Biden’s clean energy proposals by creating a new emissions-based tax credit for the production of clean electricity. All energy sources — including renewables and fossil fuels — qualify but they have to have zero or net negative carbon emissions. The plan would also create a production tax credit of up to 2.5 cents per kilowatt hour or an investment tax credit of up to 30% for those energy sources.

“Energy policy is tax policy and the federal tax code is woefully inadequate to address the country’s energy challenge,” Wyden said on a call with reporters Wednesday. He said his plan would simplify the “crazy quilt” of more than 40 energy-related tax benefits.

The Oregon Democrat is looking to put his own stamp on renewable energy tax credit proposals. Biden’s $2.25 trillion infrastructure plan would extend existing tax credits for wind energy, solar power, and energy storage. Wyden’s plan takes a different approach by replacing all the tax credits for each specific energy type with a technology-neutral tax incentive that would benefit low emitters.

Wyden said his legislation is “quite well aligned” with the president’s plan and that the two proposals likely will be intertwined as the Senate considers the energy-related portion of Biden’s infrastructure proposal. Wyden also said he has been talking “regularly” with Senator Joe Manchin, a moderate Democrat who represents coal-producing West Virginia, and whose vote will be critical to passing any legislation through the evenly divided Senate.

Technology Neutral

Wyden’s plan also would create technology-neutral tax credit for domestic production of transportation fuel that is 25% cleaner than average. In addition, his proposal would create tax credits for energy-efficient homes and commercial buildings. He said his plan provides long-term investments that are critical to meeting the country’s energy efficiency goals. Biden has said he wants to reach a 100% clean-electricity standard by 2035.

The Biden and Wyden proposals have significant overlap in the types of energy investment they are looking to prioritize. Both plans would pump money into grid improvements, energy storage, electric vehicles and charging stations.

They both also call for the end of existing fossil fuel tax breaks, such as deductions for drilling costs and distribution expenses. That is is likely to face significant opposition from the oil and gas industry, as well as Republicans as the plan moves through Congress.

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Stuart Turley is President and CEO of Sandstone Group, a top energy data, and finance consultancy working with companies all throughout the energy value chain. Sandstone helps both small and large-cap energy companies to develop customized applications and manage data workflows/integration throughout the entire business. With experience implementing enterprise networks, supercomputers, and cellular tower solutions, Sandstone has become a trusted source and advisor.   He is also the Executive Publisher of www.energynewsbeat.com, the best source for 24/7 energy news coverage, and is the Co-Host of the energy news video and Podcast Energy News Beat. Energy should be used to elevate humanity out of poverty. Let's use all forms of energy with the least impact on the environment while being sustainable without printing money. Stu is also a co-host on the 3 Podcasters Walk into A Bar podcast with David Blackmon, and Rey Trevino. Stuart is guided by over 30 years of business management experience, having successfully built and help sell multiple small and medium businesses while consulting for numerous Fortune 500 companies. He holds a B.A in Business Administration from Oklahoma State and an MBA from Oklahoma City University.