Democrats in Congress have blended a good idea — repealing special tax breaks for oil companies — with a bad one, a punitive “windfall profits” tax on Big Oil.
We simply don’t believe in punishing business for success, as the special punitive tax on energy companies would do. But special tax breaks to old-line energy companies don’t make sense either. If crude oil prices of $120 a barrel and pump prices of $4 a gallon aren’t enough incentive to explore for new supplies, then no amount of corporate welfare from Washington will do the trick.
Eliminating these subsidies at a time of record profits would allow Congress to fund a bill by Sen. Maria Cantwell, D-Wash., that would help improve energy efficiency and stimulate renewable energy. The bill is co-sponsored by Colorado Sens. Wayne Allard and Ken Salazar, as well as 19 other senators.
Existing federal incentives for renewable energy have been particularly effective in sparking wind and solar energy in Colorado, coupled with wise acts by the state legislature as part of Gov. Bill Ritter’s “new energy economy.”
Yet the federal incentives will expire this year unless Congress acts. Loss of such incentives could cost 100,000 jobs in the renewable-energy industry while deepening American dependence on the expensive foreign-energy imports that are already weakening the economy. Far from letting those investment incentives expire, we need to write them into the law on a long-term basis, as most European companies have done, to reduce our dependence on foreign oil.
Cantwell’s plan would extend federal incentives for investments in wind energy, biomass, hydropower and geothermal electricity facilities and the 30 percent investment credit for businesses that install solar or fuel cell equipment. It’s a step toward a prosperous and sustainable economic future.
