WASHINGTON, DC - In an effort to stimulate the economy and boost domestic energy production, the U.S. Senate voted 93 to 2 to extend renewable energy tax incentives to consumers and companies. U.S. Senator Jack Reed (D-RI) supported the Energy Independence and Investment Act of 2008, which extends and expands several tax incentives designed to help Americans save on energy and would promote the development of renewable energy sources. This is the ninth time that Reed has voted for this proposal which up until now has faced Republican resistance.

"With millions of Americans struggling with the rising cost of energy, this bill is a real victory for consumers. Not only would the legislation help families save on their energy bills, but it would also create green jobs for thousands of Americans and lessen our dependence on foreign oil," said Reed. "These clean energy tax credits are vital to spurring the development of alternative energy and providing consumers with the tools and incentives they need to make their homes and businesses more energy efficient."

Highlights from the Energy Independence and Investment Act of 2008 include:

  • Energy Efficiency Improvements - the bill provides tax credits and deductions worth nearly $3 billion for home energy efficiency improvements. It offers a 10% tax credit (up to $500) for the purchase of insulation, exterior doors, duct sealing, and up to $200 for energy efficient windows as well as credits for the purchase of energy efficiency furnaces, water heaters, and heat pumps. The credits, which had expired at last December, will be extended to cover all of 2008 through 2011. It also provides tax credits for the purchase of energy efficient appliances, such as refrigerators, washing machines, and dishwashers, through 2010. In addition, the bill gives credits to builders of highly efficient homes through 2011.
  • Plug-in Electric Drive Vehicle Credit - the bill establishes a new credit for plug-in electric drive vehicles. The minimum amount of the credit is $2,500 and the maximum amount of the credit $7,500.
  • Long-term Extension of Renewable Energy Production and Investment Tax Credits - the bill extends the tax incentive for the production of renewable energy for three years until December 31, 2011 and extends the production tax credit for wind through 2009. It also expands of the investment tax credit and residential tax credits for the installation of solar, fuel cell, and small wind generation.
  • New Clean Renewable Energy Bonds ("CREBs") - the bill authorizes $2 billion of new clean renewable energy bonds to finance facilities that generate renewable energy such as wind.

The Energy Independence and Investment Act of 2008 must now be passed by the U.S. House of Representatives before being sent to the President to be signed into law.