December 2016 – We are proud Utah business leaders working to power hospitals, make businesses more energy-independent and globally competitive, and create jobs at home that cannot be outsourced. We seek to diversify the U.S. energy economy and grow new industries.
But while many clean energy technologies provide powerful long-term savings, the initial capital costs of equipment can be a barrier to some of our clients — especially those taking a risk in founding a new business. That is why Congress created an investment tax credit to help companies manage these higher upfront costs. Across America, this tax incentive has already helped hundreds of businesses create tens of thousands of new jobs. Unfortunately, the credit is slated to expire at the end of this year.
Last December, Congress extended federal tax incentives for two major types of clean energy, wind and solar, for the next five years. Those businesses now have a market driver to continue to develop their technologies in ways that will expand these industries and ultimately bring down costs. But lawmakers left tax credits for other clean energy systems out of the deal, putting technologies such as combined heat and power, microturbines, fuel cells, small wind, geothermal, and geothermal heat pumps at a competitive disadvantage.
Our clean energy businesses here in Utah aren’t looking for special treatment. We just want our clean and efficient technologies to be treated fairly and given the same chance to succeed.
But extending the tax credit for the remaining clean energy systems isn’t just about fairness; it’s also about growing the economy by reducing energy costs, producing more energy here at home and investing in jobs that cannot be shipped overseas.
For example, installing combined heat and power systems, which burn a single fuel source and use both the heat and electricity, must be done on-site, creating jobs that stay in local communities. It often relies on natural gas — utilizing America’s abundant domestic fossil fuel resources in the cleanest, most efficient manner possible. Once installed, combined heat and power can double a facility’s energy efficiency, making that company more competitive in the global marketplace. And since these systems generate energy on-site, they can even be used to power hospitals or other sensitive facilities during power outages or other grid disturbances, making our communities safer.
Geothermal and geothermal heat pump technology provides another great opportunity for investing in local job creation. These technologies allow a home or business to use the natural temperature of the earth underground to passively heat and cool buildings. Again, these are construction jobs that can’t be outsourced. We are already seeing China emerge as a global leader of solar panel and wind turbine production, allowing for more outsourcing in those industries. Extending tax credits beyond wind and solar will make it easier to create and sustain jobs here at home.
Our lawmakers — particularly Sen. Orrin Hatch, who is chairman of the Senate Finance Committee — should level the playing field for clean energy technologies by extending the investment tax credit for all clean energy systems. Extending these tax credits would allow for real choice in the energy industry and allow businesses to find the energy solution that’s right for them. Doing this creates more clean energy and more jobs here at home. It’s the right thing for Utah and the right thing for the United States.
Jeff Dixon is corporate account manager for Horizon Power Systems in Utah and chair of the Utah Combined Heat and Power Working Group. Cary Smith of Sandy is a partner at Sound Geothermal Corporation and sits on the board of the International Ground Source Heat Pump Association.