Cooperatives Applaud Energy Bill

Shortly before Congress recessed, the 2005 Energy Bill was passed and sent to President Bush for his signature. On August 8, President Bush signed this bill into law. The energy bill addresses many issues, some of which have a direct impact on Access Energy Cooperative, and others that will create some opportunities for homeowners and businesses.

The energy bill contains a provision that removes Access Energy Cooperative from the Federal Energy Regulatory Commission (FERC) regulation. When we paid off our loan to the U.S. Department of Agriculture several years ago, we became what is known as a FERC regulated cooperative. This regulation requires us to file quarterly reports and to get FERC approval for any economic development grants or loans we apply for. This regulation is costing your Cooperative over $20,000 a year. Thanks to the passage of the energy bill we will no longer be incurring these regulatory costs.

The energy bill also includes tax incentives for home owners and businesses.

The bill will allow home owners a tax credit of ten percent (10%) of the cost of "Qualified Energy Efficiency Improvements" up to a maximum credit limit of $500.00. Items that qualify for the credit include: insulation, exterior doors, and windows. The credit also applies to geothermal heat pumps, air source heat pumps, central air conditioners and water heaters. These appliances must meet certain efficiency standards to qualify for the credits.

The bill also provides tax credits of up to a maximum $2000 for solar hot water systems and solar photovoltaic systems. The tax credits apply to improvements and equipment put into service between December 31, 2005, and December 31, 2007. For a more detailed summary of the tax credits provisions of the energy bill I would recommend visiting www.fsec.ucf.edu/EPAct-05.htm.

Throughout the decade-long process of working to pass a “good” energy policy, the electric cooperatives’ focus never wavered from protecting you, the consumer.

For example, the new energy policy will enhance the reliability and affordability of our nation’s electric grid. The Energy Policy Act gives federal regulators the authority necessary to spur the construction of new transmission facilities – which we desperately need in this country now – and ensures that we will have affordable access to that transmission.

A significant portion of the energy bill deals with renewable energy. Iowa’s electric cooperatives currently are involved in many renewable energy projects throughout the state, generating energy from wind, solar, biomass and hydro. However, prior to passage of the Energy Policy Act, electric cooperatives did not have access to the same types of incentives as the ones enjoyed by the investor-owned utilities.

Federal incentives for electric cooperatives to offset the expenses of developing renewable energy technologies are part of this law. These incentives – called Clean Renewable Energy Bonds – are an innovative and fair way to give electric cooperatives a financing tool for renewable generation that is comparable to the tax credits that investor-owned utilities receive for developing energy sources such as wind, sun and biomass.

On the topic of environmental responsibility, the Energy Policy Act also contains various incentives for emissions controls on power plants and for energy-efficiency programs. For example, this legislation requires deployment of advanced air pollution control equipment and processes that enhance environmental performance above current obligations. It also includes innovations for existing power plants such as mercury removal, gasification systems and advanced combustion systems.