During the year-end budget negotiations, which have become an annual Congressional ritual Congress presented the biomass industry with what could be an opportunity for tax parity.
For the past few years, the end of the year has marked a scramble by all involved in renewable energy to persuade Congress to preserve or extend, for the next year, the production tax credit (PTC) and investment tax credit (ITC). At times, this tax package involves issuing a retroactive credit to cover the current or previous year during the times when the credits were not renewed the previous year.
For the biomass industry, these credits have been useful at times, but they are difficult for potential facilities to use. A one-year or two-year extension is plenty of time to develop a wind farm, but not nearly enough time to plan and site a new biomass facility, source its fuel and obtain proper permits. Add to that the value of the credit—half of what wind projects receive—and the tax extender ritual has become a tradition that our industry doesn’t benefit much from, but also can’t afford to be cut out of.
This year, tradition went out the window.