The House and Senate on 18th September passed omnibus appropriations legislation that provides $1.15 trillion to fund the federal government for the remainder of FY 2016. Attached to the omnibus was a $620-plus billion package of tax cut extenders. The final bill dropped riders to prevent implementation of the EPA’s greenhouse gas rules for new and existing power plants and to prevent funds in the State Department budget from being transferred into the Green Climate Fund. However, Congress appropriated no funds for the Green Climate Fund.
The tax extenders package includes multi-year re-authorizations for the Wind Production Tax Credit and the Solar Investment Tax Credit. The wind credit was extended to 2019, but declines by 20% for facilities that begin construction in 2017 and then 20% more each year thereafter. The credits will still apply to the first ten years of production for all wind facilities that start construction before 2020.
The solar credit remains at 30% of construction costs through 2019 and then declines to 23% in 2020, 22% in 2021, and 10% in 2022 for non-residential and third-party-owned residential installations. The credit for solar installations by homeowners drops to zero in 2022. The renewal of renewable energy subsidies shows that crony corporate welfare still flourishes in the Republican 114th Congress.
The omnibus package does include a provision that lifts the 42-year-old ban on crude oil exports. The U. S. is the only country in the world that bans crude oil exports.
The final vote in the House on H. R. 2029 was 316 to 113, with 5 not voting. One-hundred fifty Republicans and 166 Democrats voted Yes, while 95 Republicans and 18 Democrats voted No. An earlier House vote of 318 to 109 attached the tax package to the omnibus appropriations bill.
In the Senate, the vote was 65 to 33. Twenty-seven Republicans and 38 Democrats voted Yes, while 26 Republicans and 7 Democrats voted No. Two Senators missed the vote.
The omnibus and tax extenders package is a huge victory for President Obama’s climate agenda. Unfortunately, most conservative Republicans who supported the EPA and GCF riders and opposed the renewable tax subsidies had little leverage in the behind-the-scenes negotiations because they had already announced that they would vote against the omnibus. A Senate Appropriations Committee staffer told me that this allowed House Minority Leader Nancy Pelosi (D-Calif.) to call the shots in the negotiations. He added that he had never seen anything like it; and he concurred that conservatives were primarily responsible for their own ineffectiveness.