Our hope is the full U.S. Senate, and House, follow the lead of the Senate Finance Committee and extend tax credits for wind energy, biodiesel and cellulosic ethanol through 2016.
The Senate panel voted 23-3 last month for the extensions.
Clearly, these extensions are important for Iowa. Consider:
- Iowa ranks first in the nation in terms of percentage of total generation of electricity from wind energy and third for employment related to the wind energy industry.
- Iowa ranks second in the nation for production of biodiesel.
- Last year, Iowa celebrated the start of a new chapter for the renewable fuels industry as cellulosic ethanol production, which uses corn plant residue left in the field, began. For the industry, this state and, indeed, the nation, cellulosic ethanol production represents a significant, if not historic advancement and holds substantial future promise.
In a broader sense, these renewables are important for the country, too, at a time when job creation, energy independence and the production of clean energy are national priorities.
As we have said before, we are comfortable with federal support for producers of energy, including both renewable and fossil fuels, in the name of achieving energy independence for the nation, but we are open to discussion of ending support within the context of reducing the federal budget and reforming the tax code if all producers are treated the same. Let's not forget, the oil, natural gas and coal industries get federal tax help, too.
In a New Hampshire campaign appearance last month, Republican presidential candidate Jeb Bush called for an end to all federal energy subsidies.
“I don’t think we should pick winners and losers,” Bush said. “I think tax reform ought to be to lower the rates as far as you can and eliminate as many of these subsidies — all of the things that impede the ability for a more dynamic way to get where we need to get.”
In our view, that's a proposal worth exploring.
Until then, tax credits for renewable fuels shouldn't be singled out for elimination.
We encourage Iowa's congressional delegation to lead the way in extending the wind, biodiesel and cellulosic ethanol tax credits.