Alternative Energy Tax Credits Hanging In The Balance

Federal tax incentives for wind, solar and other forms of alternative energy are set to expire at the end of the calendar year unless Congress votes to reauthorize them.

Democrats are demanding the $1.7 billion in incentives be revenue-neutral and Republicans want offshore drilling to qualify for the same treatment as wind and solar. Not surprisingly, the issue is at a stalemate.

Published reports indicate that the tax incentives can reduce a company's operating costs by 30%, so projects that are already in the works are being completed at a feverish pace in order to be online by December 31 and qualify for the tax break. Planned projects are being shelved, however, and financing is drying up as well.

This isn't the first time that alternative energy tax credits have been on the block. The last time Congress allowed wind energy incentives to expire, the volume of wind energy projects dropped by 93%.

Industry trade groups have indicated that no tax breaks mean far fewer projects and that will result in as many as 115,000 jobs lost as early as 2009.

Look for this to heat up after the pollitical nominating Conventions conclude next week.

Wind, solar projects race to finish before tax credit expires [USA Today]