Sens. Dianne Feinstein (D-Calif.) and Jeff Merkley (D-Ore.) want to extend a grant program for solar and wind energy developers that was added to the stimulus in response to the credit crunch.
Wall Street had been a major financial backer of solar and wind projects for years, attracted by a 30 percent tax credit. Banks used the credit to offset their tax burden, but that was no longer an inducement as profits turned to losses during the financial crisis.
As financing dried up for renewable energy projects, lawmakers instead allowed developers to apply to the Treasury Department for grants. The program, which is section 1603 in the American Recovery and Reinvestment Act, expires next year. Feinstein’s and Merkley’s bill would extend it to 2012. The bill number is S. 2899.