[Congressional Record Volume 151, Number 25 (Monday, March 7, 2005)]
[Senate]
[Page S2170]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. DORGAN (for himself, Mr. Smith, Mrs. Murray, Ms. Cantwell, 
        Mr. Johnson, and Mr. Harkin):
  S. 542. A bill to amend the Internal Revenue code of 1986 to extend 
for 5 years the credit for electricity produced from certain renewable 
resources, and for other purposes; to the Committee on Finance.
  Mr. DORGAN. Mr. President, today I am joined by Senator Smith of 
Oregon and several of our colleagues in introducing legislation to 
extend the soon-to-expire tax credits in Federal law that incentivize 
the development and use of renewable energy.
  Mr. President, as you know, Federal policymakers have been working 
over the past couple of years to pass comprehensive energy reforms that 
will encourage greater domestic energy production, increase energy 
efficiency and improve the nation's overall energy security by reducing 
our dependence on imported sources of energy.
  This country imports more than 60 percent of its oil from abroad, and 
Americans have watched as oil and gas prices--and their energy bills--
have skyrocketed, in large part due to the threat of disruptions to 
energy supplies in volatile regions of the Middle East. The evidence 
also suggests that the United States is ramping up its demand for 
imported natural gas. At a recent Senate Energy Subcommittee hearing, 
for example, we heard about plans to build thirty-one new liquefied 
natural gas terminals in this country. The reason for this activity is 
that the United States is projected to import about 28 percent of our 
natural gas supply by the year 2025. Clearly, something must be done to 
reduce our reliance on energy imports. I hope that we will complete 
work on a comprehensive energy bill in this Congress that will help us 
do so.
  However, there are some fiscal policies already in place that will 
help us move toward greater energy independence and diversity. Current 
law's Federal income tax credit for facilities producing electricity 
from wind and other renewable energy sources is among the most 
important of these polices. In fact, we are told by energy developers 
year after year that the renewable energy production tax credit, PTC, 
is absolutely essential for bringing renewable energy-generated 
electricity to the marketplace at a competitive rate. Today, for 
example, our country has over 6,700 megawatts of wind energy capacity, 
or enough electric capacity to serve about 1.6 million homes. And all 
that electricity is generated on U.S. soil, producing U.S. jobs.
  Last year, Congress extended the availability of the PTC and expanded 
it to cover other forms of renewable energy--including geothermal and 
solar. I supported this effort. However, I am frustrated that Congress 
continues to undermine its own effort to develop domestic renewable 
energy resources by failing to ensure that the PTC is available for a 
longer term.
  In North Dakota, we have abundant renewable energy resources 
including wind. In fact, North Dakota's wind development potential is 
so great that many energy experts call North Dakota the ``Saudi 
Arabia'' of wind energy. And the PTC is critical for the continued 
growth of this industry in North Dakota, Oregon, and elsewhere. But the 
PTC, which is found in Section 45 of the Tax Code, is also scheduled to 
expire at the end of this year.
  That is why Senator Smith and I are introducing a bipartisan bill 
today to extend the Section 45 tax credits for producers who place new 
renewable energy facilities in service before January 1, 2011. Our 
five-year extension bill also continues the indexing of the credits for 
inflation and extends alternative minimum tax relief as provided under 
current law. Finally, the bill includes provisions to ensure that tax-
exempt cooperatives, municipal utilities and Indian tribes can receive 
the benefit of the tax credits for their investments in renewable 
energy.
  Billions of dollars of expected investments by the renewable energy 
industry will, once again, be put on hold if we fail to extend the 
credit. Inexplicably, Congress has allowed the PTC to expire three 
times since its inception in 1992. When this happens, the industry 
suffers a huge drop in investment and many good-paying jobs are lost. 
Failing to promptly extend the credit this year will prevent new 
renewable energy facilities from coming on line and lead to layoffs by 
the businesses that support this industry, including wind tower and 
turbine blade manufacturers.
  The bottom line is that short-term extensions of the renewable energy 
tax credit creates a boom and bust cycle of short-term planning, 
painful layoffs and higher than necessary project costs. Financial 
lenders stop providing the capital needed for wind energy projects 
about 4 to 6 months before the credit is scheduled to expire because of 
the uncertainty surrounding the future availability of the credit. This 
uncertainty inevitably leads to a rush to complete projects at higher 
costs, and those costs are passed along to consumers.
  In conclusion, I will be working hard with Senator Smith and others 
to get this legislation passed by the Senate as soon as possible. 
Unless we act quickly, renewable energy developers will, once again, be 
forced to suspend or cancel new projects that move us toward energy 
independence and create significant economic opportunities for a rural 
state like North Dakota.
  Mr. President, I am pleased that this legislation has already been 
endorsed by the American Wind Energy Association, the American Corn 
Growers Association and others interested in renewable energy 
development. I urge my colleagues to work with us to get this measure 
enacted into law early in this session of the 109th Congress.
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