Advocates say U.S. House tax cut proposal would kill clean energy investments, jobs
The tax cut legislation that U.S. House of Representatives Republicans are putting together in Washington includes measures that will cost thousands of jobs in Wisconsin and undercut the state's progress toward cleaner energy, according to environmental and labor advocates.
To help pay for the extension of tax cuts enacted in the first Trump administration, the GOP-led House Ways and Means Committee is proposing to repeal clean energy tax credits, Politico reported this week. The tax credits were among the measures enacted in the 2022 Inflation Reduction Act (IRA).
'These credits are not just numbers on a balance sheet out in Washington D.C,' said Emily Pritzkow, executive director of the Wisconsin Building Trades Council, in an online press conference Wednesday. 'They are representing real jobs, real economic growth, and real progress towards Wisconsin's sustainable energy infrastructure. Since the IRA was signed into law in 2022 we have seen an unprecedented boom in clean energy development in the trades.'
The press conference was hosted by Forward Together Wisconsin, a nonprofit established to inform people about the Biden administration's infrastructure and climate investments and to defend them.
'We've been seeing this real opportunity to drive energy costs down, and I cannot for the life of me understand why people want to reverse that progress,' said former Lt. Gov. Mandela Barnes, president of Forward Together Wisconsin.
In addition to the tax credits that the U.S. House proposal would repeal, President Donald Trump in his second term has frozen federal clean energy grants that were part of the 2022 legislation. Those include grants to establish a network of electric vehicle charging stations — prompting a lawsuit by 15 states, including Wisconsin.
Solar energy investments that have boomed in the last three years are among those that are threatened by the House proposal, according to advocates.
'At a time when billions of dollars are being invested in states that overwhelmingly voted for President Trump, this proposed legislation will effectively dismantle the most successful industrial onshoring effort in U.S. history,' Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association, said in a statement this week.
Since passage of the IRA, Wisconsin has seen $933 million in clean energy and transportation private-sector investments, along with just over $2 billion from federal grants and loans, according to Innovation Policy & Technology, a San Francisco climate change policy think tank. The organization tallied 61 new clean energy and transportation projects that got underway in the state, with 45 manufacturing American-made products.
'Lower investment and higher energy bills due to repealing these federal programs and tax incentives will cost nearly 5,200 Wisconsin jobs in 2030 and more than 6,400 jobs in 2035, compared to current policies,' Innovation Policy & Technology reported.
The advocacy group Climate Power has calculated that without the federal support $5.4 billion for 15 planned Wisconsin clean energy projects could be in jeopardy.
Of those projects, 12 — 80% — are in five congressional districts represented by Republicans, according to Climate Power. Three representatives of those districts — Bryan Steil in the 1st CD, Scott Fitzgerald in the 5th CD and Glenn Grothman in the 6th CD — voted against the IRA in 2022. The other two, Derrick Van Orden in the 3rd CD and Tony Wied in the 8th CD, weren't in office at the time but publicly opposed the legislation.
John Jacobs, business manager of International Brotherhood of Electrical Workers Local 494 in Southeast Wisconsin, said the clean energy tax credits and related policies have spurred investment and employment for the union's members.
'I see first-hand how the clean energy tax credits have delivered on their promise, creating good family-sustaining union jobs across Wisconsin,' Jacobs said. 'Repealing these tax credits could be devastating to many, but would put thousands of jobs at risk and hurt a growing industry.'
The tax credits were 'an investment in America,' he added. The jobs lost if the credits are repealed 'translate to economic instability for families across our state.'
The IRA also included a provision that extends the value of the tax credits to nonprofit organizations and government agencies.
Thanks to that benefit, called direct support payment, the Menasha Joint School District in the Fox Valley has qualified for a $4 million reimbursement from the federal government for installing rooftop solar energy and geothermal energy systems in a school currently under construction, said Brian Adesso, the school district's business services director.
Once the school is complete the district expects to save $159,000 a year on its electric bill, 'which is cost savings to local taxpayers and money that can be invested back into the students and staff,' Adesso said at the Forward Wisconsin press conference.
Adesso said the tax credits gave the district 'certainty' it needed to be willing to undertake the clean energy additions to the project. Killing the credits would make that choice harder for school districts and impose higher costs on local property taxpayers, he added.
'The bill making its way through Congress takes a sledgehammer to the tax credits,' Addesso said — ending some credits early and attaching 'bureaucratic restrictions that could make many of the credits unusable.'
Barnes said Forward Wisconsin Together is calling on Congress to protect the clean energy initiatives. 'The people of Wisconsin deserve better,' he said. 'The country deserves better. Clean energy as we know is the future, and we have to continue to invest in it.'
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