Solar, wind incentives boost Colorado firms

Senate adds benefits to win support

Gargi Chakrabarty

Published October 2, 2008 at 12:05 a.m.

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Chris Schneider / The Rocky

At full capacity, this 2-megawatt solar panel, completed at Denver International Airport in July, will produce about 5 percent of the power used at the airport.

U.S. senators on Wednesday modified a Wall Street bailout plan by adding tax breaks for solar, wind and other renewable energy to appease representatives in the House who had defeated the original plan Monday.

The added incentives are similar to those in the Tax Extenders Act passed by the U.S. Senate last month.

The original bailout plan had the federal government pouring $700 billion of taxpayer money to rescue Wall Street firms battered by the meltdown of the home mortgage industry.

But many in Congress denounced the plan for having no benefits for ordinary taxpayers, prompting lawmakers to modify it in the hope of shoring up support.

Sen. Ken Salazar, D-Colo., said he has been receiving 500 to 1,000 calls each day from angry Coloradans who don't want taxpayer money bailing out Wall Street firms, but said the addition of tax breaks for renewable energy would benefit Colorado and create jobs.

"More than 1,000 renewable energy companies in Colorado are creating jobs, and we are seeing many parts of the state beginning to flower because of renewable energy," Salazar said during a teleconference. "The tax credits in the legislation, especially the eight-year credit for solar energy will have huge potential for Colorado."

The modified plan extends the renewable energy production tax credit and the solar energy and fuel cell investment tax credit for eight years.

It also expands the residential energy-efficient property credit to include small wind equipment and geothermal heat pumps. The bill provides tax incentives for carbon capture, energy-efficient buildings and the purchase of plug-in hybrid vehicles.

House Republican leaders said the new elements in the plan would appeal to their rank-and- file.

House Democratic leaders were cautious. Rep. Steny H. Hoyer, D-Md., said, "There's no doubt in my mind that the Senate added this because they thought that's the only way they could get it passed," according to news reports.

Colorado has a growing renewable energy industry, and the proposed tax breaks would help keep the momentum.

Direct employment in the renewable-energy sector in the metro area more than doubled to 13,940 in 2007 from 5,760 in 2004, according to metro Denver Economic Development Corp.

There were about 104 renewable-energy companies in the seven-county metro area in 2004.

Last year, that number jumped to 1,010, although the geographical area increased to include Weld and Larimer counties.

Colorado ranked 10th among the 50 states in renewable-energy employment with 15,400 workers in 2007 - up 2.6 percent from the previous year, surpassing the nationwide growth of 2.1 percent.

The modified bailout plan

* Extends renewable energy production tax credit.

* Expands for eight years solar energy and fuel cell investment tax credit.

* Modifies residential energy- efficient property credit, to include small wind equipment and geothermal heat pumps.

* Offers incentives for carbon capture and sequestration projects.

* Gives tax credits for energy- efficient buildings.

* Offers tax incentives for the purchase of plug-in hybrid vehicles.

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