| It's certainly no secret: the cost of | | | | limited to geothermal energy equipment that |
| renewable energy production and its | | | | produces, uses or distributes energy derived |
| implementation can be extremely high. This is | | | | from geothermal deposits. A personal tax |
| the very reason why tax credits are often | | | | credit of 10% with a $300 maximum can be |
| used to enable renewable energy sources to | | | | taken for geothermal heat pumps. |
| compete with fossil fuels. | | | | |
| | | | The federal government also included |
| With rising oil and natural gas prices, the | | | | production tax credits for renewable |
| war in Iraq and environmental problems | | | | energies. These credits allow companies to |
| centering on global warming and air | | | | invest in renewable technologies and write |
| pollution, our nation is concerned about | | | | the investment off against other investments. |
| their energy security and environmental | | | | This was a major push of support for |
| issues. The United States is recognizing the | | | | renewable energy technologies. The credit was |
| need and power of renewable energy and is | | | | extended until December 31, 2008. The credits |
| supporting its development through federal | | | | are 1.9 cents per kWh for wind, geothermal, |
| income tax credits and incentives. | | | | closed-loop biomass and 1.0 cent per kWh for |
| | | | hydroelectric power, landfill gas, municipal |
| President George Bush signed the Energy | | | | solid waste and open-loop biomass. These |
| Policy Act of 2005 into law on August 8, | | | | pertain to the first ten years of operation |
| 2005. It took over four years for Congress to | | | | |
| pass after reviewing several different | | | | Similar to production tax credits, there were |
| versions. It extended tax credits for wind | | | | also provisions for renewable energy |
| and biomass energies for two more years and | | | | production incentives (REPI) for state and |
| included additional tax credits for solar, | | | | local governments, as well as, nonprofit |
| geothermal and ocean energy. | | | | electrical cooperatives. The enacted law |
| | | | included new qualifying energy generation |
| Solar tax credits apply to residential and | | | | facilities for solar, wind, biomass |
| business users. This tax credit would pertain | | | | (excluding municipal solid waste combustion) |
| to eligible equipment installed between 1/1 | | | | landfill gas and certain types of dry steam |
| 06 and 12/31/08. The equipment installed | | | | geothermal energy. It was extended through |
| would include those solar systems that | | | | fiscal year 2016 and also included ocean and |
| generate electricity, heat and cool or | | | | wave energy. |
| provide hot water to structures. It must also | | | | |
| be operational in the first year the credit | | | | These credits will be applied to any amount |
| is taken and the taxpayer must be the | | | | that remains after any other state or utility |
| original user. The credit is 30% with a | | | | incentives have been taken. There are |
| $2,000 cap for each unit for residential | | | | numerous states that do offer incentives |
| taxpayers and it is 30% with a no business | | | | also. Some new state incentives include a |
| cap specified for corporate users. After 12 | | | | California state rebate program for |
| 31/08 the corporate tax credit will return to | | | | photovoltaics, an Illinois state grant |
| 10%. | | | | program for wind energy, a New Jersey state |
| | | | rebate program for geothermal heat pumps and |
| The geothermal corporate credit remains at | | | | a Pennsylvania property tax assessment for |
| 10% with no maximum stated. This credit does | | | | wind energy. These are just a few of the many |
| not apply to geothermal heat pumps and is | | | | state incentives that exist. |