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POWER Act Would Create Equality Among Clean Energy Technologies

Increasing industrial efficiency can decrease pollution, create jobs, strengthen the electric grid

Inconsistencies in the tax code have put highly efficient, cogeneration technologies at a disadvantage relative to other clean and efficient energy sources. Technologies such as combined heat and power (CHP) and waste heat to power (WHP) help the nation’s largest and most intensive energy users reduce use, costs, and pollution. Recently, however, Congress took steps to correct the tax disparities and ensure equal treatment for all industrial energy efficiency technologies. The bipartisan Power Efficiency and Resiliency (POWER) Act, proposed in both the House (H.R. 2657) and the Senate (S. 1516), would amend the federal investment tax credit to give industrial energy efficiency technologies such as WHP and CHP equal standing with solar and fuel cells.

CHP and WHP technologies can double the overall efficiency of producing electricity and heating and cooling buildings, as well as improve the reliability of the electrical grid during extreme weather and cyber or physical attacks. Further, significantly increasing industrial energy efficiency can help reinvigorate our nation’s manufacturing base, creating 600,000 to 1 million highly skilled jobs. 

The POWER Act proposes changes to reduce the initial capital cost of installing WHP and CHP projects, spurring investment in these energy-saving units. Extending the tax credit would encourage developers to take advantage of the thousands of unrealized megawatts of potential, and flexible incentives would mean more U.S. companies could install these systems, making some of the largest power users more efficient, productive, and competitive.

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