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Business Voice for the Environment

November 20, 2017
 
Dear Members of the Colorado Congressional Delegation,
           
            As Congress considers changing our tax code, it is imperative that Coloradan innovation and clean jobs be protected through smart policies that increase – not hamper - the rapid job growth and economic savings being generated by the energy efficiency and renewable sectors in our state. One of the goals of reforming the tax code is ensuring Colorado businesses can operate by a set of clear, understandable rules. That is what clean energy businesses are asking for as well: this means keeping in place the previously agreed-to extension and phase down of the Investment Tax Credit (ITC) for solar and Production Tax Credit (PTC) for wind, honoring an agreement to extend the ITC deal to other clean energy technologies,  reinstating energy efficiency tax credits that support millions of jobs in construction and manufacturing and not prematurely ending an electric vehicle incentive that helps consumers afford vehicles that save them at the pump.
 
Clean energy is one of the fastest-growing sectors of our state’s economy. There are now more than 66,000 clean energy workers in Colorado according to E2’s Clean Jobs Colorado report, - that’s more than a 6 percent increase over the previous year. Energy efficiency represents the largest sector in number of jobs, including some 42,000 Coloradans that work in the sector, while wind power has brought more than $4.8 billion into our economy and supplies 16 percent of electricity in the state. Meanwhile, there are more than 433 firms working in the solar sector that combined have invested close to $3 billion in the state.            
 
Nationally, there are 3 million clean energy jobs in the United States, according to analysis by the Department of Energy and E2. Solar energy capacity in 2016 was 4,500 percent higher than the Department of Energy predicted a decade ago. Wind energy capacity is 350 percent above projections, according to a new report. In 2016, more than $46 billion was invested to support 21.5 gigawatts of new renewable power generation, according to the American Council on Renewable Energy (ACORE). While tax policies alone do not create the jobs or increased investment in these sectors cited above, they do provide certainty to businesses and increase confidence in markets.
 
In 2015, Congress agreed to extend and phase down the ITC and PTC. This promise to businesses and investors provided much-needed certainty for the solar and wind industries. A recent analysis shows that the extension of the federal tax credits will create more than 220,000 jobs and add nearly $23 billion to the U.S. economy in 2017. Tampering with that deal through the guise of tax reform – either by removing these along with other tax incentives or to pay for lowering the overall corporate tax rate - could create serious market disruptions for these sectors and leave many Coloradans out of a job – especially in rural America where the clear majority of solar and wind installations are located.
 
We know this because such a market disruption occurred in the geothermal, small hydro, hydrokinetic and fuel cell sectors, after they were unexpectedly left out of the ITC extension in 2015 and no deal took place in 2016.  Congressional leaders have agreed these technologies must be extended with the ITC to both the business Section 48C and residential Section 25D credits, thereby providing parity for all clean energy technologies. With tax reform, Congress now has the chance to right this wrong and provide greater certainty for these technologies for the next few years while the ITC phased down.
 
The Energy Efficient Commercial Buildings Tax Deduction (179D) under the Commercial Building Modernization Act and the New Energy Efficient Home Credit (45L) energy efficiency tax credits that had been extended in years’ past, were allowed to expire in 2016, hampering deployment of energy efficiency nationwide. These should be included in any tax reform deal and given a long-term extension. Energy efficiency helps businesses overcome market barriers by attracting producer and consumer attention to the opportunities and transforming markets for new technologies and practices. In addition, to technological innovation, energy efficiency incentives help consumers and businesses saving money and have supported more than 2.5 million jobs nationwide.
 
Finally, the 30D electric vehicle (EV) credit, which allows for consumers buying an EV to get a $7,500 tax credit while providing market access to hundreds of thousands of Americans who can then dramatically lower what they pay at the pump, should be allowed to phase down on schedule. This credit is designed to phase out once a given automaker has sold 200,000 units of EVs. As the market increases in size – each company making EV’s will hit this limit and the credit will phase out.
 
The renewable energy and energy efficiency sectors create jobs. They save money for consumers and businesses alike. They drive innovation and competitiveness in our energy markets and linked industries. As business owners, investors and others, we urge you to continue to build on the successful utilization of the tax code to promote innovation and jobs in the Centennial state by protecting and expanding clean energy tax provisions. Any tax reform legislation aimed at ensuring there are expanding business and employment opportunities for Coloradans should include the policies that provide certainty for those sectors and members of Congress must work responsibly to include those provisions.
 
Sincerely,

World Clock