Congress Reinstates Federal Geothermal Heat Pump Tax Credits
The reinstated GHP tax credits are retroactive to Jan. 1, 2017, and extend to Jan. 1, 2022
WASHINGTON — The U.S. geothermal heat pump (GHP) industry scored a victory for its workforce and its employers today as Congress approved federal legislation that included the extension of federal tax credits for residential and commercial GHP installations. The measure was included in the $320 billion, two-year continuing resolution (CR) budget deal that will continue to fund the government.
The reinstated GHP tax credits are retroactive to Jan. 1, 2017, and extended to Jan. 1, 2022. The bill changes an important consideration for commercial geothermal heat pump projects, making them eligible if commenced by Jan. 1, 2022, rather than using a placed-in-service deadline.
“Today’s action by Congress finally fixes the inequity created two years ago when tax credits for solar installations were extended through 2021,” said Doug Dougherty, president and CEO, Geothermal Exchange Organization (GEO). “Credits for technologies, including GHPs, fuel cells, microturbines, small wind, and combined heat and power [CHP] were left to expire at the end of 2016."
Since then it was an uphill fight, as GEO and its allies worked diligently for parity with the solar industry through bills in both the House and Senate. GEO’s message to legislators was ultimately heard: Congress shouldn’t be picking winners and losers when it comes to renewable energy and fairness in tax policy.
“And, now, we have finally achieved parity with solar,” said Dougherty.
Coalition partners included all of the “orphaned” clean energy technologies, and, among others, the National Rural Electric Cooperative Association (NRECA), the National Association of Homebuilders (NAHB), and ACCA. In the days prior to passage, GEO joined a larger coalition of business, energy, transportation, real estate, and agriculture stakeholders who gathered forces to make their case for including tax extenders in the CR that passed the Senate and the House.
GEO’s relentless campaign to regain GHP tax credits included several executive fly-Ins to Washington, District of Columbia, in 2017, plus hundreds of visits to House and Senate legislative offices by GEO’s board members, staff, industry volunteers, and HVACR association members. Grassroots efforts by GEO members and supporters included job site visits set up for key legislators to show them firsthand the value of GHPs and plead the industry’s case for tax credit parity with solar.
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“Achieving this critical milestone for our industry couldn’t have been accomplished without the positive and aggressive leadership of GEO staff, manufacturers, members, and our D.C. lobbying team as well as the tireless efforts of my fellow board members during several Fly-ins to Washington during the past two years,” said Joe Parsons, board chairman, GEO, and GEO Board Chairman Joe Parsons, who also serves as president of EarthLinked Technologies Inc.
“Our hard-fought victory for the GHP industry helps ensure a bright future for our technology,” said Dougherty. “It will stem the loss of jobs we now face, provide more time to overcome market barriers, achieve economies of scale, and help spread the environmental and economic benefits of GHPs across America.”
For more information, visit www.geoexchange.org.
Publication date: 02/09/18
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