New federal legislation that takes effect Jan. 1 creates a framework for a new variation of an old themewhat actions we will commit ourselves to do in the New Year for the Earth and our children.
The legislation heavily favors energy producers, particularly traditional fossil fuels and nuclear power. Although energy conservation and efficiency are given less attention, there are some opportunities that should not be overlooked.
Annual ethanol production should increase from 4 billion gallons to more than 7.5 billion gallons. The existing ethanol plant in Lena, the new plant under construction in Rochelle and the newly proposed plant for Winnebago County, along with local farmers, job seekers and taxing bodies will all benefit.
A 10-year tax credit of $0.019 per kilowatt for electricity generated from wind turbines will form the financial base for wind farms. It makes the newly approved 80 MW wind farm in Ogle County and other proposed projects economically viable.
The new law fails to make energy efficiency the cornerstone of U.S. energy policy, ignoring the quickest, least costly means to lessen dependence on imported oil and natural gas, avoid increased degradation of natural areas and reduce local air pollution and our contributions to global warming.
Some tax credits are available for individual consumers for energy efficiency. Benefits, which cannot exceed specified limits, are targeted at specific efficiency improvements in a principal residence. Businesses will alert consumers to eligible purchases and benefit from selling products to them. They will also benefit from implementing energy conservation measures in their facilities and the equipment used in their business.
Most citizens can benefit from tax credits stimulating the design and improvement of energy-efficient homes and vehicles. An abbreviated list of benefits was highlighted in the recent newsletter of The Iowa Renewable Energy Association.
Homeowners may receive tax credits for efficiency improvements up to:
30 percent of the cost to a maximum of $2,000 per tax year for installing solar electric and solar hot water systems which serve home needs excluding swimming pools and hot tubs;
$500 on thermostat upgrades and caulking to limit energy losses;
$200 for installation of new exterior windows;
$300 for installation of highly efficient central air conditioner, heat pump or water heater;
$150 for installation of a highly efficient furnace or boiler; and/or
10 percent on expenditures to improve the building envelope including advanced main circulating fans, insulation, exterior windows, doors and skylights and metal roofs coated with heat reduction pigments.
Tax credits will also be available for contractors who build energy-efficient homes meeting federal standards.
Tax credits ranging from $1,700 to $3,000 will be available for the purchase of hybrid cars and advanced lean burn technology vehicles. Cars and light trucks that are more fuel efficient than 2002 models will receive a tax credit on a dollar-for-dollar basis for the efficiency expenditure. Another provision will allow a 30 percent tax credit for installing a clean fuel refueling station at ones residence, or for use in a trade or business.
From the Dec. 28, 2005-Jan. 3, 2005, issue