House Ways and Means Committee Reconciliation Proposal Misses an Opportunity to Maintain Clean, Renewable Hydropower
Industry Calls on Congress to Take Action
Washington, D.C. (September 14, 2021) – The National Hydropower Association today expressed disappointment in the clean energy tax provisions proposed by the U.S. House Ways and Means Committee. Since hydropower is an essential part of a climate solution, the Committee’s failure to include H.R. 4499, the pending bipartisan legislative proposal to maintain and enhance existing hydropower, is a significant missed opportunity to accelerate the nation’s transition to a clean energy grid.
The House Ways and Means proposal does include important provisions for pumped storage and would provide a 10-year extension of the existing hydropower production tax credit (although at half the value of other zero-carbon technologies such as wind and solar) and adds new hydropower phase down requirements.
Significantly, the proposal fails to include a new 30% Investment Tax Credit (ITC) to maintain and enhance the existing hydropower fleet, specifically focused tax incentives for environmental improvements, dam safety enhancements, and grid resiliency measures. The provisions, proposed in both H.R.4499 (sponsored by Rep. DelBene and Young) and S.2306 (sponsored by Sen. Cantwell and Murkowski), are supported by a broad coalition of environmental and river conservation groups, dam safety advocates, and industry groups.
“The House should not miss the historic opportunity in the Reconciliation bill to provide the hydropower industry with the resources that are essential to achieving President Biden’s goal of a zero-carbon electricity grid,” said Malcolm Woolf, CEO & President of the National Hydropower Association. “Our nation cannot address climate without leveraging existing hydropower, which currently provides electricity to an estimated 30 million Americans. Working with the river and climate communities, we offered a bipartisan plan to optimize hydropower generation efficiency and protect the existing 13 gigawatts of installed hydropower capacity up for expensive and uncertain relicensing over the next decade. As an industry, we call on Congress to seize on this opportunity to take bold action to ensure that these facilities aren’t at risk. This is a once-in-a-generation chance to improve the performance of the existing hydropower fleet.”
To demonstrate the critical need for these provisions, 48 hydropower asset owners and developers today sent letter to Congressional leadership urging for the inclusion of the 30% ITC in the Reconciliation package.
“By not providing parity with other renewable electricity resources, the House Ways and Means Committee proposal puts hydropower at an economic disadvantage,” added Woolf. “Hydropower infrastructure projects that often last for 50 years or more. Since these projects are capital-intensive, targeted tax incentives to maintain and enhance the existing hydropower fleet, as well as to add generation on existing dams, is a critical part of a comprehensive climate solution. We urge Congress to allow hydropower to compete equitably with other renewables to accelerate the push to a carbon-free grid, while creating well-paying jobs.”