Reps. Estes, Thompson and Sens. Coons, Moran Introduce Bipartisan Bill to Expand Renewable Energy Tax Advantages
Bill levels energy playing field for renewables
Washington, June 13, 2019 | Greg Steele (202-225-6216)
WASHINGTON—Congressman Ron Estes (R-KS), Congressman Mike Thompson (D-CA), along with Senator Chris Coons (D-DE) and Senator Jerry Moran (R-KS) introduced the Financing Our Future Energy Act today. This bipartisan and bicameral bill gives renewable energy projects access to master limited partnerships (MLP), a tax advantage currently only available to oil, gas, and coal projects.
“The Financing Our Energy Future Act updates our tax code to allow renewable energy projects to have equal access to capital,” said Rep. Estes. “As a supporter of an all-of-the-above energy strategy for our country, I’m proud to sponsor this bill that will extend vital resources to renewable energy initiatives, creating jobs and contributing to our nation’s dominance in energy production and innovation. I look forward to helping secure passage of this bill in Congress.”
“Harnessing the potential of renewable energy sources is a key part of reducing our dependence on fossil fuels. Master limited partnerships are tax structures that allow energy projects to get access to capital at a lower cost, making them more competitive to private investment. But these structures are currently only available to the oil, gas and coal industries,” said Rep. Thompson. “That’s why I’ve joined colleagues from both sides of the aisle in the House and Senate to introduce the Financing Our Future Energy Act, a bill to expand MLP access to renewable energy projects in order to attract new investment. This will help create more jobs in the renewable energy sector, allowing us to better tackle the threat of climate change.”
A Master Limited Partnership is a business structure that is taxed as a partnership, but whose ownership interests are traded like corporate stock on a market. By statute, MLPs have only been available to investors in energy portfolios for oil, natural gas, coal extraction and pipeline projects. This bill levels the playing field to make renewable energy sources more competitive for private capital investments.
“Clean energy technologies have made tremendous progress in the last several decades, and they deserve the same shot at success in the market as traditional energy projects have experienced through the federal tax code,” said Sen. Coons. “By updating the code, the bipartisan Financing Our Energy Future Act levels the playing field for a broad range of domestic energy sources -- clean and traditional alike -- to support the all-of-the-above energy strategy we need to power our country for generations to come. This practical, market-driven solution will unleash private capital and create jobs, and that’s why it has earned broad support from Republicans and Democrats in Congress as well as think tanks, business leaders, and investors. Updating the tax code in this way will help increase parity and ensure that these energy technologies can permanently benefit from the incentives that traditional energy sources have depended on to build infrastructure for more than 30 years.”
“The United States has the largest and most efficient capital markets in the world, yet our renewable energy companies rarely have access to those markets,” said Sen. Moran. “In order to grow our economy and increase our energy security, sound economic tools like master limited partnerships should be expanded to include additional domestic energy sources. The MLP Parity Act will allow the renewable energy sector to utilize the MLP structure for project development making it accessible to a broader and deeper investment pool that can drastically reduce the time and cost associated with deploying new energy technologies.”
Newly eligible energy resources under this legislation would include solar, wind, marine and hydrokinetic energy, fuel cells, energy storage, combined heat and power, biomass, waste heat to power, renewable fuels, biorefineries, energy efficient buildings, and carbon capture, utilization and storage (CCUS).
The Financing Our Energy Future Act is endorsed by American Council for an Energy-Efficient Economy (ACEEE), the American Council on Renewable Energy (ACORE), Advanced Biofuels Business Council, the Algae Biomass Organization, the Alliance for Industrial Efficiency, the Alliance to Save Energy, Amazon, Biotechnology Innovation Organization (BIO), BPC Action, Carbon180, Carbon Capture Coalition, Center for Climate and Energy Solutions (C2ES), Ceres, Clean Air Task Force, Covanta Energy, Energy Storage Association, Growth Energy, International District Energy Association, Master Limited Partnership Association, the National Association of State Energy Officials (NASEO), National Hydropower Association, Natural Resources Defense Council (NRDC), National Wildlife Federation, Solar Energy Industries Association (SEIA), and Third Way.
Ron Estes is a 5th generation Kansan and represents Kansas’ 4th Congressional District in the U.S. House of Representatives. He serves on the House Committee on Ways and Means.