Congressman Mike Thompson (D-Calif.) on Friday introduced the Growing Renewable Energy and Efficiency Now (GREEN) Act, which is a bill that uses the tax code to expand the use of renewable energy.
Below are questions and answers regarding the details of this bill and its odds for becoming law.
What does this bill do?
In short, the legislation provides tax incentives that promote the deployment of green energy technologies, while also providing incentives to reduce greenhouse gas emissions.
What are the odds that this bill becomes law?
If past is prologue, this bill will have a difficult time becoming law as introduced.
This legislation was introduced in the last Congress. It had the support of all Democrats on the House Ways and Means Committee, the panel that writes tax law, and, it also had the support of the committee’s Chairman, Congressman Richard Neal (D-Mass.).
Despite this level of support, the tax-writing committee never took up the bill. Even Thompson, who chaired the House Ways and Means Subcommittee on Select Revenue Measures – the subcommittee with jurisdiction over tax – did not hold a hearing on this legislation.
It was also never voted on in the House or Senate.
If the chance for the bill becoming law is slim-to-none, why mention it?
The change in President could affect the fate of this bill.
President Joe Biden has made combatting climate change one of his top priorities. On the day he was sworn into the Oval Office, he signed an executive order rejoining the Paris climate accord. He has also vowed to move quickly on climate change action, which includes transitioning to clean-energy and cutting carbon emissions by 2035 and achieving net-zero emissions by 2050.
Accomplishing these goals will likely require action from Congress. The GREEN Act is legislation that could help Biden on this front.
What are the next steps regarding the Green Act?
An upcoming infrastructure bill is expected to include a section on renewable energy. The GREEN Act could be the platform for introducing renewable energy and climate change in the infrastructure legislation. Congressional Democrats could introduce an infrastructure package as early as June.
The GREEN Act will likely need to be modified if it becomes a part of an infrastructure bill to win bipartisan support in the House.
In the Senate, the party division is 50/50 (50 Republicans and 50 Democrats, or Independents that caucus with Democrats). Barring the use of budgetary measures, it will require ten Senate Republicans to join all Senate Democrats to pass an infrastructure package from the Senate. It will also take the support of certain Democrats in the House and Senate who represent states where oil producers are large employers and will likely oppose the GREEN Act.
In other words, enacting the GREEN Act, be it as part of an infrastructure bill or stand-alone legislation, will be a heavy lift.
This is a roundup of tax news and opinion. Any opinions expressed or implied are those of the author and not necessarily those of Eide Bailly. Opinions found in linked items are those of the authors of the linked item, not of your bloggers or of Eide Bailly. “$” means link may be behind a paywall. Items here do not constitute tax advice.