By U.S. Senator Chuck Grassley
Iowans know there’s no use messing with Mother Nature during a summer thunderstorm. The occasional power outage triggered by severe weather requires households to ride out the storm without electricity. Some families may welcome a reprieve from so-called screen time. For others, the novelty of living off the grid wears thin. Sooner rather than later, the outage may turn to outrage. Accustomed to a reliable energy infrastructure, American society arguably has grown dependent upon energy-on-demand 24/7, 365 days a year.
Most Americans live and work in climate-controlled homes and businesses. We use energy to run our transportation fleet, operate farm machinery and power our homes, factories, schools and offices. Turning on the television, surfing the Internet, doing laundry and cooking with energy-dependent household appliances has become as essential to daily life as indoor plumbing.
Considering the significant consequences to the U.S. economy, public health, public safety and national security, maintaining access to affordable, abundant sources of energy is more than a matter of convenience. That’s why a comprehensive energy strategy – one that includes expanding renewables, promoting conservation and developing traditional domestic sources – is a big priority for policymakers.
As Iowa’s senior U.S. senator, I have long-championed efforts to cultivate Iowa’s pivotal potential to produce clean-burning, emissions-free, homegrown renewable energy. As the father of the first-ever federal wind energy tax incentive and a fierce advocate for renewable fuels, I lead the way in Washington to help Iowa contribute to a clean energy renaissance for America.
Promoting the production and use of renewable energy factors into tax and spending decisions at the policymaking tables. Unleashing science and technology has helped to improve fuel efficiency, produce electricity from wind and create fuel from crops and biomass. Fostering sound stewardship of our natural resources protects the environment and adds value to American agriculture.
Despite centuries-long tax breaks embedded in the federal tax code for fossil fuels, the more recent tax and regulatory tools designed to promote emissions-free and clean-burning renewables must survive a periodic rinse-and-repeat cycle on Capitol Hill. Key policy prescriptions that give renewable energy a fighting chance to flourish are included in a legislative package commonly known as a “tax extenders” package. Some 50-plus provisions must withstand regular scrutiny in Congress. If they aren’t renewed, they expire. I’m all for giving the tax code a thorough scrubbing, but the limited shelf life of these tax extenders generates a great deal of uncertainty and unfairness to renewable energy producers, job creators, workers and farmers.
As a senior member of the tax-writing Senate Finance Committee, I pressed for renewal of several tax provisions that are key to Iowa’s economy and environment, including the Production Tax Credit (PTC) and the Investment Tax Credit (ITC). Both drive growth of renewable energy, including wind, solar, biomass, cellulosic ethanol and biodiesel. The 179 expensing and bonus depreciation provisions also generate significant economic growth and job creation.
I’m glad to report that Sen. Hatch, chairman of the Finance Committee, has included these key provisions in the legislative vehicle known as the chairman’s mark, a key step in the legislative process. This is a critical victory to extend these expiring tax incentives through December 31, 2016.
How do these tax incentives help foster America’s ascent toward clean energy and economic growth?
They bring certainty to investment that helps boost development, sustainability and expansion of homegrown renewable energy.
Take wind energy. Generating wind power creates zero emissions. In Iowa, wind energy supplied more than 28 percent of all in-state electricity production in 2014. That puts us first in the nation. Even with 98 wind projects online, Iowa still boasts untapped wind power potential that is capable of exceeding 40 times the state’s current electricity needs.
Wind energy drives economic growth and higher wages. Iowa is home not only to an inexhaustible wind supply, but it also serves as a national leader of wind-related manufacturing facilities that produce good-paying jobs in construction, operations, maintenance and support services.
Wind energy is good for Iowa. It puts people to work in good-paying jobs, creates a new revenue stream in lease payments for farmers, fosters an economic ripple effect that revitalizes rural communities, lessens dependence on foreign energy, displaces pollution and expands the tax base to support local public services.
In 2014, wind energy supported up to 7,000 jobs in Iowa, generated $17.1 million in lease payments and accrued $10 billion in capital investments. That’s good for economic growth.
The facts show that bringing stability and certainty to clean energy policy is good for the economy and the environment. Championing renewable energy that’s engineered by human ingenuity and produced by human hands builds upon America’s centuries-long promise of prosperity. Renewable energy can help raise standards of living and leave Mother Earth better than we found it for posterity.
My message for Washington: Let’s not mess around with these expiring tax breaks that do so much good for America.