3Center or American Progress | Good Government Investments in Renewable Energy
economically he same as direc spending boh or he governmen and or beneciaries. Wih direc spending, he governmen brings in ax money and hen spends i, while wih ax expendiures he governmen simply reduces he axes ha a company owes.Eiher way, he company has more money and he ederal governmen has less.
Tax expenditures should be held accountable for achieving results
Te underlying reasons or so much energy spending being done hrough he ax codeare unlikely o change, a leas in he shor erm. Tereore i’s imporan ha energy ax expendiures work well. Inprevious CAP work we’ve called or regular reviews o all ax expendiures o ensure his spending is eecive, ecien, and necessary.Tere are some energy ax expendiures ha clearly do no mee his sandard. SimaGandhi and I wroe in deph abou his issue in“America’s Hidden Power Bill ,” where we described obscure ax credis or he oil-and-gas indusry ha have exised or morehan 80 years and have no demonsrable benes or Americans. Such ax breaks simply provide windall benes o hese maure indusries a axpayer expense. We also dis-cussed several ax credis or clean energy ha are much beter designed.Tis issue brie calls or Congress o ake acion on some o he mos imporan cleanenergy ax issues in oday’s policy and poliical debaes: he producion ax credi, heinvesmen ax credi, and he reasury Cash Gran Program. Each o hese can beexended in a way ha boh leads o powerul incenives or invesmen in our energy uure and represens good ax policy.Finally, i’s imporan o noe ha each o he hree primary issues is signican or adieren reason. Because renewable energy sources have dieren characerisics hey require dieren reamens wihin he ax code. Simply exending he producionax credi is no sucien. Neiher is exending he reasury Cash Gran Programnor improving he invesmen ax credi. Congress needs o do
o hese hings. I Congress only akes acion on one o hese, hey will in eec be “picking winners”across echnologies.Congress should insead ocus on a comprehensive invesmen package ha creaespahs or all echnologies so ha American businesses will inves in he echnologiesha make he mos sense or our counry.
Three ways to invest efficiently and effectively
Forunaely, we already know some o he bes ways or he ederal governmen omake meaningul invesmens. Trough eecive and ecien use o he ax code, he