Bipartisan tax proposal to promote clean energy technologies launched in the US

The bipartisan proposal aims to accelerate the development of clean energy technologies through investment and production tax credits.

Two US Senators have introduced a bipartisan energy tax proposal to encourage innovation in the clean energy sector and rapidly scale up new technologies.

Senator Mike Crapo (R-Idaho), ranking member of the US Senate Finance Committee, and Sheldon Whitehouse (D-Rhode Island), US Senate Finance Committee member, introduced the Energy Sector Innovation Credit (ESIC) Act yesterday.

This article requires Premium SubscriptionBasic (FREE) Subscription

Unlock unlimited access for 12 whole months of distinctive global analysis

Photovoltaics International is now included.

  • Regular insight and analysis of the industry’s biggest developments
  • In-depth interviews with the industry’s leading figures
  • Unlimited digital access to the PV Tech Power journal catalogue
  • Unlimited digital access to the Photovoltaics International journal catalogue
  • Access to more than 1,000 technical papers
  • Discounts on Solar Media’s portfolio of events, in-person and virtual

Or continue reading this article for free

The ESIC is a technology inclusive, flexible investment tax credit (ITC) or production tax credit (PTC) designed to encourage innovation across a range of clean energy technologies, including generation, storage, carbon capture and hydrogen production.

It seeks to promote clean energy innovation by providing up to 40% ITC or 60% PTC for low market penetration technologies across a variety of energy types. It will then phase out credits as technologies mature, which allows access for the most innovative products, rather than allowing Congress to pick winners when credits expire.

It looks to group technologies into different cohorts as determined by the Department of Energy (DOE), national labs and other stakeholders. It also provides an avenue for “unforeseen” technologies to be eligible for ESIC through an expedited-consideration process by the DOE and Congress.

“ESIC will incentivise technology-wide clean energy innovation so new, clean technologies can rapidly scale up and compete independently in the market,” said Senator Crapo. “Moreover, ESIC automatically scales down credits as technologies’ market penetration ramps up, so taxpayer dollars do not subsidize market-mature technologies.”

“Our bipartisan legislation will accelerate nascent clean technologies that have the potential to compete against heavy-polluting forms of energy and create good jobs in the process,” added Senator Whitehouse.  

Original co-sponsors of the Senate legislation include Senate Finance Committee members John Barrasso (R-Wyoming) and Michael Bennet (D-Colorado) and Senate Energy and Natural Resources Committee members Jim Risch (R-Idaho) and John Hickenlooper (D-Colorado).  House Ways and Means Members Tom Reed (R-New York) and Jimmy Panetta (D-California) have introduced identical legislation in the U.S. House of Representatives.

Last month, US-based solar manufacturers lauded another tax credit proposal by Democratic Senator Jon Ossoff that would establish new tax credits to rapidly boost American solar manufacturing and drive down “prohibitive costs”, branding it a “new hope for American solar”.

The Bill, however, is considered unlikely to pass in its current guise due to Republican opposition, according to US sources.

Read Next

April 26, 2024
The National Renewable Energy Laboratory (NREL) has published a report on laser welding, which could make solar panels easier to recycle.
April 18, 2024
The US Solar Energy Industries Association (SEIA) has called on the US Congress to accelerate legislative reform for solar projects in the US.
March 26, 2024
The US Department of Energy has invested up to US$22 million to improve planning, siting and permitting of large-scale renewable projects.
March 22, 2024
The US Department of Energy (DOE) will commit US$475 million in funding for five clean energy projects at mine sites across the US.
February 29, 2024
The projects cover different types of clean energy, including solar, battery energy storage systems (BESS) and microgrids.
February 15, 2024
The US has the potential to add nearly 1TW of community solar capacity if all technically viable community solar is deployed, according to the National Renewable Energy Laboratory (NREL).

Subscribe to Newsletter

Upcoming Events

Upcoming Webinars
July 31, 2024
1:00 PM (BST) / 2:00PM (CEST)
Solar Media Events
September 24, 2024
Warsaw, Poland
Solar Media Events
September 24, 2024
Singapore, Asia
Solar Media Events
October 8, 2024
San Francisco Bay Area, USA
Solar Media Events
October 15, 2024
Santiago, Chile