The Energy Independence & Tax Relief Act of 2008
- Sponsored by Sen. Max Baucus (D-MT), the Energy Independence Act was introduced in the Senate on June 12, 2008, but died in the Senate Finance Committee for lack of action. However, all major provisions were added as amendments to other legislation and became law.
- Senator Baucus said he introduced the Energy Independence Act as a way to ensure consideration of extending or creating tax provisions that would give incentives to invest in renewable energy technologies. Some provisions of the bill were previously included in the Senate Finance Committee version of the 2007 Energy Bill; however, that version failed to garner enough votes to avoid a filibuster.
- Provisions extending the renewable energy production tax credits, solar and fuel cell investment tax credits, and energy-efficient building and appliance tax credits were included in the Energy Improvement and Extension Act of 2008 as part of the Emergency Economic Stabilization Act of 2008. These tax credits were further extended and modified by The American Recovery and Reinvestment Act of 2009.
Bonds for qualified energy conservation and certain sustainable or green energy buildings were included in the Energy Improvement and Extension Act of 2008.
Similarly, new clean energy renewable bonds were included in both the Energy Improvement and Extension Act of 2008 and the American Recovery and Reinvestment Act of 2009. First allowed by the Energy Policy Act of 2005, these bonds provide tax credits and interest-free financing for certain renewable electricity generating facilities. - A provision for accelerated depreciation for smart meters and smart grid systems was passed in the Energy Improvement and Extension Act of 2008. The new schedule could allow investors to depreciate the property over 10 years instead of 20 years.
A carbon audit of the tax code to be performed by the National Academy of Sciences was authorized by the Energy Improvement and Extension Act of 2008. This audit is meant to "identify the types of and specific tax provisions that have the largest effects on carbon and other greenhouse gas emissions and to estimate the magnitude of those effects." - In addition, the Energy Independence & Tax Relief Act contains some provisions not related to energy. Three of these relate to individual income taxes: lowering the earned income threshold for refundable child tax credits, adding deductions for local real property tax, and a stopgap measure to prevent more taxpayers from having to pay the Alternative Minimum Tax (AMT) for tax year 2008. One-year patches for the AMT were passed for tax years 2008 and 2009 by the Emergency Economic Stabilization Act of 2008 and the American Recovery and Reinvestment Act of 2009, respectively.