President Obama signed the American Recovery and Reinvestment Act of 2009 into law yesterday.
The massive $787 billion bill supports national strategies in efficiency and renewable energy, smart grid, transmission, advanced vehicles, and many other aspects of the environment and climate change.
The final economic recovery package invests $92 billion in cleantech, including $32.80 billion in clean energy, $26.86 billion in energy efficiency, and $18.95 billion in green transportation. That's less than the House Bill ($100 billion) but more than the Senate bill ($86 billion).
We're happy the $50 billion in guarantees for nuclear and liquid coal was removed from the Bill.
The Alliance to Save Energy estimates the energy efficiency measures alone can create over 100,000 jobs over the next two years and, over the life of the measures, reduce U.S. carbon dioxide emissions by nearly 200 million metric tons. They commend Congress for extending, expanding, and simplifying federal income tax credits for homeowners who make energy efficiency home improvements and for breaking new ground on utility regulatory reform and stronger energy building codes.
"This is a bold first step in moving our nation from the ‘dark ages' of excessive energy use, in which we currently are the least efficient of all industrialized economies, to becoming the most efficient," says Alliance President Kateri Callahan.
The Bill also includes $1.5 billion for improvements on our public lands including remediating abandoned mines. The funding goes to the National Park Service, the Forest Service and the Bureau of Land Management. "These much needed funds will create thousands of jobs, reduce water pollution, and restore fish and wildlife habitat in rural communities across the country," says Lauren Pagel, Earthworks Policy Director. The EPA estimates that 40% of the headwaters of western watersheds are polluted by mining.
Key Aspects of the Bill include:
- Clean energy tax credits extended and "recession proofed" by offering choices in how investors take the credit.
- Creation of a 30% tax credit (capped at $2 billion) for renewable energy companies building manufacturing facilities in the U.S. over the next two years.
- A $500 million Green Jobs Act will train 70,000 workers in renewable energy and energy efficiency jobs over 2 years;
- $4.5 billion to upgrade the grid for greater efficiency and to be able to handle large renewable energy inputs;
- $5 billion for the Weatherization Assistance Program, sufficient to weatherize 1 million homes a year, while creating jobs in auditing and retrofitting industries;
- $4.5 billion to make 75% of federal buildings more energy efficient, the nation's biggest energy user;
- $3.1 billion for the State Energy Program to help citizens and businesses save energy; $300 million for state matching grants for consumer rebates on higher-tier energy-efficient appliances;
- $3.2 billion for State Energy Efficiency & Conservation Block Grants that allow state/ local governments to aggressively implement energy efficiency programs;
- $8.4 billion in public transit, with $1.5 billion set aside for upgrades and expansions of existing transit systems, creating or preserving 252,000 jobs;
- $400 million to encourage states to adopt stronger building energy codes and to adopt utility regulatory reform leading to rate reforms, such as decoupling, that will help their customers save energy;
- $8 billion for new high speed rail projects;
- $19 billion for water infrastructure and clean up.
Production Tax Credit (PTC) extended: The wind tax credit is extended for three years; geothermal, biomass, hydropower, landfill gas, waste-to-energy and marine facilities extended through December 31, 2013.
Investment Tax Credit (ITC) available for ALL renewable energy sources: Project developers for all renewables have the option of taking a 30% tax credit, which previously only applied to solar.
Repeals Subsidized Energy Financing Limitation on ITC: Businesses and individuals can qualify for the ITC even if their property is financed with industrial development bonds or other subsidized energy financing.
Grant Program in Lieu of Tax Credits: Project developers have a choice: they can either take the 30% tax credit (ITC) or apply for a grant for 30% of a project's cost from the Treasury Department. Eligible projects start construction in 2009 or 2010. Grants will be issued within 60 days of the grant application or after the facility is placed in service.
Increases Credit for Alternative Fuel Pumps: Credits for installing alternative fuel pumps at gas stations increase from 30 to 50% ($30,000 to $50,000) for 2009-2010.
Advanced Energy Manufacturing Credits: Projects that re-tool or build manufacturing facilities to make components for renewable energy or advanced grid, energy storage systems for electric or hybrid cars, and equipment for carbon capture and storage can receive a 30% tax credit ($2 billion total for the program).
Credit for Plug-in Vehicles: Increases the tax credit for the first 200,000 plug-ins to $2500, plus $417 for the first 5 kWh of battery capacity, plus $417 for each additional kWh of battery capacity, up to $7,500 per vehicle. $2500 credit for neighborhood electric vehicles and a credit equal to 10% of the first $40,000 for converting a vehicle to a plug-in.
5-Year Carry-Back Provision for Operating Losses of Small Businesses: extends the carry-back period for net operating losses (NOL) from 2 to 5 years for tax years 2008 and 2009.
Extends Bonus Depreciation: temporarily extends and increases the bonus depreciation Congress enacted last year through 2009. Write offs can be applied to capital expenses between $250,000 to $800,000.
Renewable Energy & Energy Efficiency: $16.8 billion over the next 10 years.
Grid Development: $4.5 billion for smart grid technology. Federal matching grants for the Smart Grid Investment Program increased from 20% to 50%.
R&D, Demonstration Projects: $2.5 billion for renewable energy and energy efficiency R&D, demonstration and deployment activities.
Federal Power Marketing Administrations: $6.5 million for capital investments in electric power transmission systems.
Advanced Batteries: $2 billion in grants for manufacturing advanced batteries and components.
Defense Energy & Efficiency Programs: $300 million to the DOD for researchand evaluation of renewable energy generation, transmission and efficiency projects. $100 million for Navy and Marine Corps for efficiency and clean energy projects.
Electric Transmission Congestion Study: The Secretary of Energy will conduct a study on the transmission issues facing renewable energy as part of the electric transmission congestion study due for release in August 2009.
Advanced vehicle Purchases: $300 million for hybrids, neighborhood electric vehicles; electric vehicles; and commercially available plug-ins.
Bond and Loan Programs
Clean Energy Renewable Bonds (CREBs): $1.6 billion for clean energy bonds that finance wind, closed-loop and open-loop biomass, geothermal, small irrigation, hydropower, landfill gas, marine renewable, and trash combustion facilities. One-third of the funding goes to state/local/tribal governments, one-third for utilities and one-third for electric cooperatives.
Renewable Energy Loan Guarantee Program: $6 billion for temporary loan guarantees for renewable energy power generation and transmission projects that begin construction by September 30, 2011.
Up to $500 million of the total can be used to develop leading edge biofuels that have been demonstrated and have commercial promise to substantially reduce greenhouse gas emissions.
Summary table provided courtesy of Ardour Capital.