Leading news: Senate Vote to Extend Tax Credits Will Help the Geothermal Market

This post brings you updates on tax extenders for geothermal and other forms of renewable energy from the U.S. Senate; movement on a comprehensive energy bill in the U.S. House; news from GEA members; and a business opportunity in Latin America.


Above: This infograph from a March 2015 DBL Investors report shows the variety of binding Renewable Portfolio Standard (RPS) policies among U.S. states. About 67% of all non-hydro renewable capacity additions between 1998 and 2012 occurred in states with active or impending RPS obligations, the report notes.

Click below to read this week’s leading geothermal news.

*Senate Vote to Extend Tax Credits Will Help the Geothermal Market, GEA Says
*Industry Groups Widely Support Clean Energy Tax Extension
*House Panel Releases Comprehensive Energy Bill
*Member News: Atlas Copco Designs New Modular Rig
*Member News: Mannvit Gets Grant for EGS Project in Hungary
*Suppliers Wanted for GDF Latin America (due Aug. 12)

Senate Vote to Extend Tax Credits Will Help the Geothermal Market, GEA Says
The Senate Finance Committee today voted to support a package of tax extenders proposed by Chairman Orin Hatch (R-UT) and Ranking Democrat Ron Wyden (D-OR). The package includes provisions extending the Production Tax Credit (PTC) for new geothermal power facilities that “start construction” by the end of 2016. Developers retain the option of converting the PTC to a 30% investment tax credit. The PTC expired at the end of 2014, although it was extended in December 2015 for a two-week period that was far too short to benefit geothermal projects.

“This is important news for geothermal developers,” said Karl Gawell, Executive Director of the Geothermal Energy Association. “It will help spur the market for new geothermal power plants which has been suffering due to slack demand and uneven tax treatment,” he said.

The Committee voted 23-3 in support of the package, with strong majorities of both Republican and Democratic Members supporting the bill. The tax extenders bill, entitled “An Original Bill to Extend Certain Expired Tax Provisions,” now moves to the Senate floor.

“The strong bi-partisan support in Committee is a good sign for the future of the Senate Tax Extenders Bill,” Gawell noted.

GEA also joined in a group letter dated July 16 that supported the extension of clean energy tax provisions (see next story).

Industry Groups Widely Support Clean Energy Tax Extension
Leading in to this week’s work by the Senate Finance Committee to pass a package of tax extenders (see story above), the Geothermal Energy Association joined over 30 trade associations, think tanks and other environmental, energy and economic organizations to urge the inclusion of provisions for geothermal and other renewables. The letter reads:

Dear Chairman Hatch, Ranking Member Wyden:

As companies, organizations, and advocates who support clean and alternative energy technology and energy efficiency deployment, we urge you to support the inclusion of equal treatment for clean energy and energy efficiency tax provisions during any consideration of a broader tax extenders package.

The nation’s suite of clean energy and energy efficiency tax provisions have a proven record of lowering the cost of clean energy, cutting carbon, and keeping the U.S. competitive in the global technology race. They promote economic development, job creation, and a cleaner environment. To continue capturing these benefits it is essential to restore stability in the marketplace by providing long-term extensions of these credits and making all provisions retroactive to the beginning of this year.

Businesses and investors need stable, predictable federal tax policy to invest capital, create and maintain jobs, and deploy pollution-reducing energy technologies. Allowing the lapsed clean energy and energy efficiency tax provisions to languish undermines investor confidence and jeopardizes continued economic and environmental benefits. These bipartisan tax provisions have a proven track record of helping scale up production and drive down the cost of clean energy technologies, thereby ensuring that market-ready energy and energy efficiency technologies are deployed to their full potential.

Once again, we urge you to quickly restore the expired clean energy and energy efficiency tax provisions and ensure that these incentives are extended for the same amount of time as other expired or expiring tax provisions. Doing so will help build the economy, create and maintain jobs, and deliver a safer, healthier future for our children.

We appreciate your consideration and look forward to working with you on this important matter.

House Panel Releases Comprehensive Energy Bill
This week the Energy and Power subcommittee of the House Energy and Commerce Committee released a comprehensive energy bill to cover such items as infrastructure, energy security and energy efficiency. The bill aims for bipartisan support and the Senate is working on a similar package. The committee Web site states it “seeks to modernize our dated energy policies that were written during a time of energy scarcity” and notes that there have been seven legislative hearings with testimonies from 9 governmental witnesses and 38 private sector organizations.

“I’m looking forward to continuing what has already been an informative discussion on our comprehensive energy bill with Wednesday’s markup,” Energy and Power Subcommittee Chairman Ed Whitfield (R-KY) said. “As we work to put our policies of energy scarcity behind us, we remain focused on maximizing our energy abundance in this new era. I appreciate the bipartisan collaboration that has gone into putting together this comprehensive bill, and look forward to our continued work together.”

Energy and Commerce Committee Chairman Fred Upton (R-MI), stated, “This week’s subcommittee vote will mark an important milestone as we work to build the Architecture of Abundance. Wednesday’s markup is the next step in ensuring we not only get this legislation done but get it done right. The sooner we say yes to energy, the sooner we can take full advantage of America’s energy abundance and bring our policies into the 21st century to create jobs and keep energy affordable.”

Meanwhile discussions continue amongst the leadership of the Senate Energy Committee, which is still hoping to produce a consensus energy bill of their own before their August recess. Several Senators have proposed important geothermal provisions that are considered “in the mix.”

Member News: Atlas Copco Designs New Modular Rig
A press release from GEA Member Atlas Copco announces a new drilling rig design that can be used for geothermal, oilfield or other purposes. The press release states, “The new Atlas Copco Diamondback drill rig with optional sliding-angle mast drilling capability of 90 to 45 degrees offers drillers precisely the rig they need with shortened lead time. The rig’s bolt-on modular components – a new concept in rig design – make it a truly multipurpose rig. Drillers can respond to rapid, after-sale changes in market opportunities and create a rig customized to their needs.” The model offers safety enhancements and are field-ready for summer 2015. Visit http://www.atlascopco.us/.

Member News: Mannvit Gets Grant for EGS Project in Hungary
GEA Member Mannvit, the Hungarian ministry of economy and the company EU-FIRE kft have together been awarded a grant for an Enhanced Geothermal System (EGS) project in Southeast Hungary through the European Union’s NER300 program. This is expected to cover up to 40% of the total estimated cost of €120 million. Mannvit states on its Web site, “In recent years Mannvit’s collaboration on multiple-utilization of geothermal energy for the heating of buildings, industry and electricity production with companies, municipalities and governments in states in Central and Eastern Europe, has steadily increased through its office in Budapest.”

Suppliers Wanted for GDF Latin America (due Aug. 12)
The Geothermal Development Facility of Latin America is inviting suppliers to submit a request to participate in the negotiated tendering procedure for the procurement of Fund Management services for the GDF Latin America. The deadline is August 12. GDF Latin America is led by KfW along with the German Federal Government, the European Union and stakeholders and it aims to overcome barriers for geothermal energy development in Latin America through a tailored Geothermal Risk Mitigation Fund. The multi-donor scheme is expected to facilitate a minimum of up to 7 geothermal plants with a cumulative capacity of at least 350 MW and a total investment of 1 billion EUR. See http://www.ndf.fi/tender/request-participate-fund-manager and http://ted.europa.eu/udl?uri=TED:NOTICE:237920-2015:TEXT:EN:HTML.

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