Resources of an independent, non -profit research institution for the future I conducted a study On the possible effects of cancellation Law of reducing inflation Tax credits.
It specifically analyzed two “technological neutral” tax credits, 45Y and 48E, where Congress was considering abolishing them.
What are the 45Y tax credits?
45Y tax credit encourages clean energy and provides electricity credit caused by qualified clean energy sources.
48E tax credit is a federal incentive for investments in the generation of clean electricity, and applies to various forms of clean energy technology.
Each of these tax credits is associated with technology that produces electricity without generating pollution.
Why cancel the clean energy tax credits great?
Resources for future researchers decided that canceling tax credits would increase energy prices by 5-7 %.
they books“The cancellation of tax credits increases dependence on natural gas, and the high prices of gas are transferred to consumers through the high prices of electricity.”
The researchers also found that canceling tax credits would reduce tax expenses, increase carbon dioxide pollution, and reduce wind generation capacity.
To reach these conclusions, the research team used a tool for analyzing energy policy mode that focuses on the electrical sector. He assessed the differences between the various regions of the American census and the consequences of canceling tax credit through multiple scenarios, including natural gas prices and demand for electricity.
How is it useful for tax credit research?
This study is in a timely manner because Congress was about to consider eliminating various credit and tax policies of clean energy. Understanding how this cancellation affects citizens and companies Helps inform legislators So they can make the best decisions for their ingredients. (Congress has since passed a copy of the Great Big Bill with major discounts for clean energy programs.)
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