An Obama Stimulus, Not A Futurama Stimulus

The stimulus package that passed in the House -- without a single GOP vote -- yesterday is not as forward thinking as it appears, despite what Nancy Pelosi said in a news conference.

"This is a bill about the future," Pelosi said. "It is a bill that will guarantee that we will create jobs, that there will be good paying green jobs that will transform our infrastructure, transform our energy and how we use it and our dependence on foreign oil."

According to the Natural Resources Defense Council's tally, outlined in the daily green, the StimPack accounts for:

* $3.4 billion for states for clean energy projects
* A grants program for technologies covered by the renewable energy tax incentives
* $6.2 billion for weatherization of low income homes
* $3.5 billion for the Energy Efficiency and Conservation Block Grant Program (supports clean energy projects primarily at the city and county levels)
* $2 billion for clean energy research & development
* $6 billion for increasing energy efficiency in federal buildings
* $12 billion for transit
* $2 billion for ready-to-go drinking water infrastructure projects
* $6 billion for ready-to-go sanitation infrastructure projects.

But the Bill doesn't go far enough, according to some critics, in support of public transportation, including light and high speed rail. Others, however, do point out that transit is one of the larger ticket items in the green portion of the package.

The Sierra Club praised the House Bill, noting that clean energy spending is at $100 billion. But "the bill isn't all green," according to other critics, and the Senate is apparently putting $4.6 billion for coal and $50 billion for the nuclear industry.

Of course, that depends upon your shade of green. Among the coal provisions outlined in a news release and a committee statement issued by Sen. Robert C. Byrd, D-W.Va. are:

*$2 billion for "near-zero emissions" power plants designed to capture and sequester CO2
*$1 billion for the Department of Energy's Clean Coal Power Initiative, and
*$1.6 billion for carbon capture at industrial plants.

I'd like to see some investment in such R&D for coal, as it remains the most plentiful resource we've got domestically and comprises such a high percentage of our energy needs today. If we can figure out how to clean it, capture and store it or just reduce its impact, I'm all for it.

And, as for nuclear, I still maintain it needs to be part of the mix.

Another source of criticism of the House Bill may be remedied in the emerging Senate version, which would adjust the alternative minimum tax (ATM), thereby holding down many middle-class Americans' income taxes for 2009.

President Obama's administration has said it would ultimately accept an ATM provision, which may go a long way towards giving the Senate Bill legs. Compromise and consensus may be the key to the Obama presidency.

But with so many other programs stuffed into this StimPack, including many traditional Dem favorites, it's hard to see the future: so much in here looks like the past.

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If You Can Afford It, New Incentives for Home Energy Efficiency

2009 brings some new incentives for homeowners to adopt energy efficiency from both state and federal sources.

The Wall Street Journal reported last week on several of these, including new provisions for tax credits in solar, small wind, and biomass stoves (those burning wood pellets or corn).

In addition, this year, both solar and wind residential tax credits can be claimed against the alternative minimum tax.

Improvements to weatherize your home could also qualify for an energy efficiency tax credit of up to $500. There are also new credits for upgrading your furnace, boilers, heat pumps, and water heaters.

Read more at WSJ.com: http://tinyurl.com/93n535

Clean Tech: Senate Extends Renewable Energy Tax Credits

Image via WikipediaLate Tuesday afternoon the Senate voted to extend renewable energy tax credits for the wind and solar industries. The final tally: 92-3; a surprising slam dunk.

Surprising because the tax credits had been held hostage by partisan politics for much of this year and, as deadlines loomed, it didn't look good for getting it passed.

But concern on both sides of the aisle about the economy and energy forced the hand of compromise. Extending the credits now also happens to secure something on the order of 115,000 jobs and at least $19 billion in renewable energy investments.

This is a good thing and has largely gone unnoticed in all the hullabaloo around the $700B Bailout plan. And, I believe, this has the potential to have more and longer impact on the economy than Paulson's Power Play.

Why? Because this investment in the new green economy can unleash opportunities for alternative energy investors and companies, opportunities that have been waiting in the wings for too long.

The Bill, known as the Energy Improvement and Extension Act of 2008, stipulates

* $18 billion in tax credits for using wind, solar, and geothermal
energy sources.
* 30 percent tax credit for the purchase of residential, commercial, and
utility-scale solar PV systems with no cap for eight years.
* Extension of the production tax credit for wind for one year.
* Extension of tax credits for wave and ocean tidal energy.
* Qualification for residential and commercial small-scale wind and geothermal heat pumps.
* Taxpayers subject to the Alternative Minimum Tax are now eligible for the tax credit.

Removing the cap for the maximum available 30 percent tax credit is a big deal for for both residential and commercial solar project developers. The previous cap was a paltry $2,000, which doesn't go far with most solar projects.

Now financiers of larger projects are eligible to get back at least 30 percent of their investment with no cap. And those who were on hold waiting for tax credits to pass, may now be gearing up.

In addition, utilities, which heretofore were not allowed to receive solar tax credits, are now able to realize the benefits. This could increase solar spending among utilities in states requiring minimum percentages of electricity from renewable resources.

Effects of the passing of this legislation were already having an impact on solar stocks yesterday.

Now it's up to the House to polish it up and for President Bush to put his veto stamp away. He has, according to sources familiar with the situation, expressed his support for renewable energy tax credits and even the ATM provisions.

We'll see.

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