September 25, 2008 / 5:11 PM / 11 years ago

House to vote on extending energy tax credits

WASHINGTON (Reuters) - The House of Representatives will try to take up legislation extending renewable energy tax credits before lawmakers head out of town in the next few days for the November elections campaign trail.

Power-generating windmill turbines form a wind farm on Backbone Mountain near Thomas, West Virginia August 28, 2006. REUTERS/Jonathan Ernst

The House tax package, which may be voted on later on Thursday, is slightly different from legislation passed by the Senate Tuesday, throwing into question whether there is time to reach a final deal.

With Congress expected to adjourn in the next few days for the November elections, time is running out for both chambers to pass a bill that can be sent to the White House.

Senate Majority Leader Harry Reid, Democrat of Nevada, warned House lawmakers on Tuesday not to alter the bill the Senate passed.

“If they try to mess with our package, it will come back here, it will die,” Reid said.

Charles Rangel of New York, the Democratic chairman of the House Ways and Means Committee, urged the Senate to be more flexible.

“We can wrap this up today if they don’t insist it’s their way or the highway,” Rangel said. “They should not miss this opportunity to pass this bill so we can make law and provide this tax relief to families and businesses.”

The White House threatened to veto the House bill in its current form. Instead, the White House said Thursday it preferred the Senate tax extension bill, which was part of a larger package that includes a measure raising the income level at which Americans must pay the Alternative Minimum Tax.

Both the House and Senate bills would extend production tax credits for wind energy for one year and investment tax credits for solar energy projects for eight years. The bills also provide tax credits for purchasing plug-in electric vehicles, though at different amounts.

Under the proposals, the 30 percent tax breaks for homeowners who purchase residential solar energy equipment would be extended eight years.

The tax breaks in both bills are funded by limiting tax breaks for oil and gas companies.

Unlike the Senate bill, however, the House bill does not provide tax incentives for refineries to process oil from shale and tar sands or for projects that turn coal into liquid fuel.

Environmental groups oppose oil shale development in the West because of the vast amount of water that would be used in states that have scarce water resources.

Rep. Edward Markey, chairman of Select Committee on Energy Independence and Global Warming, applauded House Democrats for not including the tax breaks for fossil fuels.

“This bill before us invests in the renewable revolution that will transform America,” Markey said. “Electric cars, cellulosic biofuels, wind and solar (energy) will assert their energy independence over the coming years if the president signs this bill.”

Reporting by Ayesha Rascoe, editing by Gene Ramos

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