The Clean Energy for America Act would consolidate more than 40 energy incentives into three emissions-based incentives to create jobs and combat climate change
Washington, D.C. – Colorado U.S. Senator Michael Bennet joined Senator Ron Wyden (D-Ore.) and a group of his colleagues to introduce legislation to overhaul the federal energy tax code, create jobs, and combat climate change. The Clean Energy for America Act would consolidate current energy tax incentives into emissions-based provisions that incentivize clean electricity, clean transportation, and energy efficiency. The incentives would be available to all energy technologies as long as they meet emissions reduction goals.
“To bolster our country’s efforts to fight climate change and cut climate pollution, we need a tax code that supports clean energy,” said Bennet. “The Clean Energy for America Act will help us build a 21st century clean energy economy and support good-paying jobs by encouraging energy conservation, clean electricity, and clean transportation through streamlined, performance-based energy tax incentives. I look forward to working with my colleagues on the Senate Finance Committee to move this legislation forward.”
The Clean Energy for America Act makes significant improvements to current law:
Incentivize Clean Energy: The bill would provide an emissions-based, technology-neutral tax credit for facilities with zero or net negative carbon emissions. Any new zero-emission facility may elect either a production tax credit of up to 2.5 cents per kilowatt hour or an investment tax credit of up to 30 percent. In addition, investments in critical grid improvements, like stand-alone energy storage and high-capacity transmission lines, would qualify for the full-value investment tax credit.
Encourage Clean Transportation Fuel: The bill would provide long-term incentives for battery and fuel cell electric vehicles and electric vehicle charging. It would also provide a technology-neutral tax credit for domestic production of clean transportation fuel that are at least 25 percent cleaner than average, with clean fuels required to reach net zero by 2030 in order to qualify.
Incentivize Energy Conservation: The bill would provide performance-based tax incentives for energy-efficient homes and for energy-efficient commercial buildings. The value of the tax incentives would increase as more energy is conserved.
Ensure Clean Energy Jobs are Good-Paying Jobs: The bill requires projects above residential size that receive tax credits to comply with federal labor requirements, including Davis-Bacon Act prevailing wage and apprenticeship requirements.
Achieve Our Emissions Goals: The bill includes stricter requirements to receive the incentives. While prior versions of the bill allowed facilities that emitted up to 300 grams of carbon dioxide per kilowatt hour to receive proportionately reduced credits, the current version limits credits to only facilities with zero or net-negative emissions, and requires clean fuel producers to reach zero or net negative emissions by 2030.
Make the Incentives More Accessible: The bill provides power projects and grid improvement projects with the option to claim the tax credits as ‘direct payments,’ and the electric vehicle credit is made refundable for consumers.
Speed Up the Electrification of the Transportation: The bill expands the electric vehicle credit to provide a 30 percent credit for medium and heavy-duty electric vehicles. And to accelerate grid improvements, the storage credit would be expanded to incorporate transmission investments.
In addition to Bennet, this bill is cosponsored by Senators Debbie Stabenow (D-Mich.), Chuck Schumer (D-N.Y.), Maria Cantwell (D-Wash.), Tom Carper (D-Del.), Ben Cardin (D-Md.), Sheldon Whitehouse (D-R.I.), Maggie Hassan (D-N.H.), Catherine Cortez Masto (D-Nev.), Dianne Feinstein (D-Calif.), Dick Durbin (D-Ill)., Amy Klobuchar (D-Minn.), Jeanne Shaheen (D-N.H.), Kirsten Gillibrand (D-N.Y.), Richard Blumenthal (D-Conn.), Brian Schatz (D-Hawaii), Mazie Hirono (D-Hawaii), Martin Heinrich (D-N.M.), Tim Kaine (D-Va.), Cory Booker (D-N.J.), Chris Van Hollen (D-Md.), Tina Smith (D-Minn.), Tammy Baldwin (D-Wis.), and Jacky Rosen (D-Nev.).
The bill text is available HERE. A one-page summary of the bill is available HERE. A section-by-section summary of the bill is available HERE.