Guest column submitted by U.S. Senator Mike Crapo
According to a report by the International Energy Agency (IEA), approximately 40 percent of cumulative CO2 emissions reductions needed to meet sustainability targets rely on technologies not yet commercially deployed on a mass-market scale. However, market availability of new energy technologies can take many years, and initial investment and taxpayer certainty is needed to ramp up deployment. Part of the problem is two-fold: 1.) our tax code does not adequately incentivize deployment of on-the-horizon clean energy technologies and 2.) Congress continually picks winners and losers in the tax extenders process, extending credits for only certain technologies and reducing taxpayer certainty. Our tax code should invest in technology-wide innovation while prioritizing responsible use of taxpayer dollars, helping to meet our environmental goals, increase American ingenuity and support our economy.
To boost this effort, I introduced S. 2475, the Energy Sector Innovation Credit (ESIC) Act, with Senate Finance Committee member Senator Sheldon Whitehouse (D-Rhode Island) and a number of my colleagues, including fellow U.S. Senator for Idaho Jim Risch. ESIC:
Idaho is a national leader in the use of clean energy and home to the leading nuclear energy lab, the Idaho National Laboratory (INL), and our communities in Idaho are making clean energy innovation a reality. Idaho Falls Mayor Rebecca Casper is working closely with INL to deploy small modular reactors, but acknowledges that federal investment is key to getting these technologies off the ground. She has said that ESIC “represents a responsible use of tax dollars. . . . and will indeed help spur a wave of new investment and innovation in clean energy sources.” In addition, global markets for these technologies could rise significantly by the end of the decade, resulting in increased demand for deployment of these technologies. Investments provided by ESIC can help American businesses be first-movers on deployment of such technologies, helping to create jobs and grow our economy.
To make far-reaching environmental improvements and boost the economy, clean energy choices must be affordable and accessible to all. Continued research and development (R&D) are a critical part of this effort, as demonstrated by the clean energy investments included in the Energy Act of 2020. ESIC builds on that progress by providing tax incentives to deploy these technological advancements, helping to bring new clean energy innovations to the marketplace. It is imperative we get these technologies deployed if we are to meet long-term emissions targets without sacrificing affordable electricity or good-paying American jobs. Breakthrough technologies across the energy spectrum will need a tax code that incentivizes their deployment and provides investor certainty. At the same time, Congress should responsibly invest taxpayer dollars without subsidizing clean energy technologies once they become commercially viable. I will continue to work to get this legislation across the finish line to back Idaho and the U.S.’s leadership in energy production, driven by our economy that allows for innovative pathways to clean energy solutions.
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