SEMI PV Group Solar Policy, March 2010
The SEMI PV Group supports the passage of a strong legislation in support of solar photovoltaic production and demand. As such, SEMI urges Congress to pass the following provisions into law:
Raising or Removing the Cap on the Renewable Energy Manufacturing Tax Credit
The American Reinvestment and Recovery Act of 2009 (ARRA) authorized $2.3 billion in tax credits for qualified investments in advanced energy projects, to support new, expanded, or re-equipped domestic manufacturing facilities. Although the goal of the manufacturing tax credit (MTC) is to grow the domestic manufacturing industry for clean energy, thereby supporting the larger goals of ARRA to stimulate economic growth, create jobs, and reduce greenhouse gas emissions, a cap of $2.3 billion limits the full ability of industry to reach these benchmarks. In fact, as of the deadline of October 16, 2009, over 500 applications were received with tax credit requests totaling over $8 billion.
SEMI PV Group urges Congress to raise the MTC cap to $7 billion so that more companies can take advantage of the MTC, create more jobs, and increase domestic production of renewable energy technologies. In addition, SEMI would like to see the cap removed completely, and have the MTC be subject to the same tax guidelines as the Investment Tax Credit (ITC), and thus subject to no cap at all.
Extension of Grant in Lieu of ITC
The Investment Tax Credit (ITC) has been successful in leveraging private capital to create growth in the renewable energy technology sector and certainty for investors. Section 1603 of the 2009 Recovery Act provides that, instead of taking the tax credit, qualified companies may be issued the credit in the form of a grant. This allows companies that might not have the capital available to directly invest cash in order to bring projects forward. Since the inception of Sec. 1603, over 230 companies have received grants totaling more than $2.3 billion. This provision of ARRA is only for projects that have gone into service through 2010. The SEMI PV Group would like to see this grant in lieu of the ITC extended until 2012 so it can continue to work as a positive mechanism for the deployment of additional renewable energy technologies.
SEMI PV Group supports of the creation of a Green Bank to help finance America’s transition to cleaner and renewable forms of energy, specifically Solar PV. The Green Bank would be a publicly owned bank, started with federal government seed money, designed to provide low interest financing to businesses to invest in clean-energy technologies. By working closely with private banks to provide loan guarantees, credit enhancements, and other financing tools, the Green Bank would stimulate private-sector lending and investment for projects that are currently unable to access conventional financing on the size and scale needed.
Renewable Energy Standard (RES)
A Renewable Energy Standard (RES) requires that a certain percentage of energy production come from renewable energy sources. Such a policy is now in effect in over half the states and the District of Columbia. PV Group supports the implementation of a strong national RES to help drive the market for increased deployment of Solar PV. The Waxman-Markey climate change bill that passed the House in June 2009 contains a national RES of 20% by 2020. The PV Group continues to support passage of a strong national RES with the House levels as the minimum threshold, as the Senate continues to debate energy legislation this year, and supports the passage of a national RES as a stand alone bill in the absence of broad based energy legislation.
If you have any questions regarding Solar PV policy, please contact Jamie Girard, manager, SEMI Public Policy at email@example.com.
March 10, 2010