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Charlie Kubert Environmental Law & Policy Center * * * Kansas Renewable Energy Conference

Meanwhile, back in D.C.: Update on Federal Renewable Energy Legislation. Charlie Kubert Environmental Law & Policy Center * * * Kansas Renewable Energy Conference September 26, 2007. Three Key Legislative Initiatives. Federal RPS Farm Bill Energy Title Energy Tax Bill.

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Charlie Kubert Environmental Law & Policy Center * * * Kansas Renewable Energy Conference

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  1. Meanwhile, back in D.C.: Update on Federal Renewable Energy Legislation Charlie Kubert Environmental Law & Policy Center * * * Kansas Renewable Energy Conference September 26, 2007

  2. Three Key Legislative Initiatives • Federal RPS • Farm Bill Energy Title • Energy Tax Bill

  3. Federal Renewable Energy Standard Legislative Drivers • 22 States already had a state RPS • RPS addresses global warming and economic development (and energy security) • RPS easier to swallow than carbon caps or taxes

  4. Federal RPS: House Version • 20% by 2020 • State policies take precedent if stronger • RECs as alternate compliance mechanism • Included in overall Energy Bill: Passed 241-172 • Boyda, Moore-yes; Moran, Tiahrt-no

  5. Federal RPS: Senate Version • 15% by 2020 • Bingaman amendment did not make it into final Senate Energy Bill • -could not overcome threatened filibuster • -opposition from Southern Senators • Next Step: House-Senate Conference in Fall? • Brownback-maybe; Roberts-no

  6. 2007 Farm Bill Energy Title Key Policy Drivers • Domestic Fuel Security • 25 x ’25 Resolution • High Energy Costs • Global Warming • Rural Economic Development • Reluctance to reduce traditional farm support • Energy vs. Conservation “Food Fight”

  7. Energy Title: House Version • Farm Bill Passed in July • Included $ 3.2 billion in new funding for Energy Title • Funded through offshore oil royalties • Heroes: Speaker Pelosi, Chmn. Peterson, Rep. Herseth-Sandlin

  8. What’s In It • Biorefineries: Loan guarantees up to $250 million • Increased funding for Renewable Energy and EE Program (up to $250 million per year) • Rebate program for small projects • Eligibility expanded to rural schools • Feasibility studies funded • Fixes PTC “Haircut”

  9. What’s In It • Bioenergy Feedstock Program (Section 9010): Expands (but doesn’t limit) eligibility to cellulosic fuels and biomass-powered plants • Biomass Energy Reserve Program: • Provides incentives to encourage farmers to cultivate and harvest energy crops if they have a demonstrated market for them. • Continuation of Biomass R&D Program

  10. Energy Title: Senate Version • Still being proposed by Chairman Harkin • Similar to House Version • Differences include: • Grant program for pilot-scale, loan guarantees for commercial scale cellulosic ethanol plants • Restriction of bioenergy program to cellulosic ethanol and bio-powered plants (GHG reduction criteria) • “Rural Repowering” grants to encourage substitution of biomass for natural gas • Energy audit and technical assistance program

  11. Section 9006: Results from 2007 • Major drop-off in funding for wind and digesters • 3 States and Energy Efficiency Dominated Awards • Iowa (grain dryers) • Mississippi (poultry farms) • Nebraska (irrigation pumps) • USDA rule changes impacted applications

  12. How Did Kansas Do? • 12 Projects ($3,800-$42,000) • Total Funding: $174,000 Note: excludes any grant/loan guarantee combinations received in first round

  13. Energy Tax Credits • Context: Baucus and Grassley on both Finance and Ag Committees • Proposed Clean Energy Tax Credits for Electricity: • Extension of PTC through 2013 • Extension/Expansion of CREBs through 2011 • Extension of solar tax credit to 2014/2019 with addition of residential small wind systems

  14. Energy Tax Credits-2 • Other Clean Energy Tax Credits: • CO2 Capture and Geologic Sequestration (clean coal) • Cellulosic ethanol production credit • “Fossil-free” ethanol production credit • Reduction in ethanol tax credit after RFS target is reached

  15. Energy Tax Credits-3 • Energy Efficiency Credits: • Energy efficient commercial buildings credit extended to 2013 • Energy efficient appliances credit through 2009 • Energy efficient homes credit through 2011 • Overall package is revenue neutral through changes in tax treatment of oil and gas production

  16. What’s Wrong with Tax Credits? • Not Assignable • Limited value for those with limited tax liability • No substitute for grants/loans for risky technology • Discourage local ownership

  17. For more information

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