Renewable-energy companies have been lobbying hard to get tax credits extended beyond the end of this year, but the appearance of a united front is belied by the fact that some of the biggest players in the solar and wind industries are also the same companies that have large businesses serving oil and gas.
That has reduced the effectiveness of the lobbying effort, according to some in the renewable industries. Hudson Clean Energy Managing Partner John Cavalier, speaking at a recent clean-energy conference hosted by Cowen & Co., urged the industry to "speak with one voice," saying the industry's lack of a united front may have stymied the adoption of favorable legislation. "Disparate lobbying efforts lead to failure," he said.
A key point of difference between pure-play renewable-energy companies and those with oil and gas interests is that the latter are against taxing oil and gas companies to pay for the extension of the tax credits, which are due to expire Dec. 31.
Legislators have also been divided on how to finance those extensions. House Democrats have insisted on them being fully funded and some of the original versions of legislation included raising taxes on oil and gas companies. Opposition from the Republican party led to a revision of the bill to include taxes on multinational companies and hedge funds as means to offset the expenditure on the tax credits for renewables. But the current bill, which has just received approval by the Senate and is due to be considered by the House next, has the oil and gas tax increases back in.
Companies that have both large renewables and oil and gas businesses include General Electric Co. (GE), which plans to invest up to $6 billion in renewable energy through its GE Energy Financial Services subsidiary through 2010. GE's Oil & Gas unit, meanwhile, which makes equipment and services for drilling, refining and other aspects of the industry, had revenue of $3.43 billion for the six months ended June 30.
BP Alternative Energy is another major investor in renewables. That company plans to invest up to $8 billion in alternatives over a 10-year period. Clearly, being part of major oil producer BP PLC (BP), the company cares about what happens to the oil and gas business. These companies are also the ones with the biggest budgets for lobbying.
BP didn't sign a letter from the industry to Senate members dated Sept. 12 that advocated the passage of tax-credit extensions.
"BP supports the extension the investment-tax credit but we don't believe that other forms of energy should be disadvantaged," said Tom Mueller, spokesman for BP America Inc. "The bill that this letter addressed includes additional taxes, so BP doesn't support that bill, which is why we are not a signatory to the letter that essentially is supporting the bill."
The company, meanwhile, spent $5.2 million on lobbying efforts for the oil and gas industries in 2008, according to OpenSecrets.org. American Wind Energy Association, the trade group that lobbies the government on behalf of the wind industry, meanwhile, spent $460,379 this year on its lobbying efforts.
Other oil companies such as Royal Dutch Shell PLC (RDSA), which invested about $1 billion into alternative energy over the past five years, and Chevron Corp. ( CVX), which committed to make about $100 million of investments per year in the sector, were notably absent from the signatories of the letter.
Chevron spent $6.2 million on lobbying for the oil and gas industries in 2008, according to OpenSecrets.org.
GE Energy Financial Services spokesman Andy Katell said his company also is concerned over tax increases for oil and gas. He added: "We do support the [ production tax credit] and the [investment tax credit]. We leave the issue of how to pay for this to the politicians." GE signed the Sept. 12 letter.
The GE unit actually came out with a study over the summer that showed that tax credits for renewable energy pay for themselves, by creating additional jobs and keeping business in the U.S., which generates additional corporate and income taxes flowing to the Treasury.
Source: Dow Jones
That has reduced the effectiveness of the lobbying effort, according to some in the renewable industries. Hudson Clean Energy Managing Partner John Cavalier, speaking at a recent clean-energy conference hosted by Cowen & Co., urged the industry to "speak with one voice," saying the industry's lack of a united front may have stymied the adoption of favorable legislation. "Disparate lobbying efforts lead to failure," he said.
A key point of difference between pure-play renewable-energy companies and those with oil and gas interests is that the latter are against taxing oil and gas companies to pay for the extension of the tax credits, which are due to expire Dec. 31.
Legislators have also been divided on how to finance those extensions. House Democrats have insisted on them being fully funded and some of the original versions of legislation included raising taxes on oil and gas companies. Opposition from the Republican party led to a revision of the bill to include taxes on multinational companies and hedge funds as means to offset the expenditure on the tax credits for renewables. But the current bill, which has just received approval by the Senate and is due to be considered by the House next, has the oil and gas tax increases back in.
Companies that have both large renewables and oil and gas businesses include General Electric Co. (GE), which plans to invest up to $6 billion in renewable energy through its GE Energy Financial Services subsidiary through 2010. GE's Oil & Gas unit, meanwhile, which makes equipment and services for drilling, refining and other aspects of the industry, had revenue of $3.43 billion for the six months ended June 30.
BP Alternative Energy is another major investor in renewables. That company plans to invest up to $8 billion in alternatives over a 10-year period. Clearly, being part of major oil producer BP PLC (BP), the company cares about what happens to the oil and gas business. These companies are also the ones with the biggest budgets for lobbying.
BP didn't sign a letter from the industry to Senate members dated Sept. 12 that advocated the passage of tax-credit extensions.
"BP supports the extension the investment-tax credit but we don't believe that other forms of energy should be disadvantaged," said Tom Mueller, spokesman for BP America Inc. "The bill that this letter addressed includes additional taxes, so BP doesn't support that bill, which is why we are not a signatory to the letter that essentially is supporting the bill."
The company, meanwhile, spent $5.2 million on lobbying efforts for the oil and gas industries in 2008, according to OpenSecrets.org. American Wind Energy Association, the trade group that lobbies the government on behalf of the wind industry, meanwhile, spent $460,379 this year on its lobbying efforts.
Other oil companies such as Royal Dutch Shell PLC (RDSA), which invested about $1 billion into alternative energy over the past five years, and Chevron Corp. ( CVX), which committed to make about $100 million of investments per year in the sector, were notably absent from the signatories of the letter.
Chevron spent $6.2 million on lobbying for the oil and gas industries in 2008, according to OpenSecrets.org.
GE Energy Financial Services spokesman Andy Katell said his company also is concerned over tax increases for oil and gas. He added: "We do support the [ production tax credit] and the [investment tax credit]. We leave the issue of how to pay for this to the politicians." GE signed the Sept. 12 letter.
The GE unit actually came out with a study over the summer that showed that tax credits for renewable energy pay for themselves, by creating additional jobs and keeping business in the U.S., which generates additional corporate and income taxes flowing to the Treasury.
Source: Dow Jones
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