H.R.1462 - To amend the Internal Revenue Code of 1986 to disallow the production tax credit and investment tax credit for offshore wind facilities placed in service in the inland navigable waters of the United States or the coastal waters of the United States. (119th Congress)
Summary
H.R.1462 aims to amend the Internal Revenue Code of 1986, specifically targeting tax credits for offshore wind facilities. The bill seeks to disallow the production tax credit and investment tax credit for offshore wind facilities placed in service within the inland navigable waters or coastal waters of the United States. This would be achieved by amending sections 48(a)(5), 45(d)(1), and 45Y(b)(1) of the Internal Revenue Code. The changes, if enacted, would apply to energy produced and property placed in service after December 31, 2025.
Expected Effects
The primary effect of this bill, if passed, would be to make offshore wind projects in inland and coastal waters less financially attractive due to the loss of federal tax credits. This could lead to a reduction in the development of such projects in these specific areas. Consequently, it may shift investment towards offshore wind projects located further offshore or towards other forms of renewable energy.
Potential Benefits
- Potentially reduces the cost to taxpayers by eliminating tax credits for specific projects.
- Could incentivize wind farm development in locations deemed more suitable or less environmentally sensitive.
- May encourage a more diverse energy portfolio by removing incentives for a specific type of renewable energy in specific locations.
- Could lead to more careful consideration of the environmental impacts of offshore wind facilities in sensitive areas.
- May reduce potential conflicts with other uses of inland and coastal waters.
Most Benefited Areas:
Potential Disadvantages
- May slow down the development of renewable energy sources, particularly offshore wind, hindering efforts to combat climate change.
- Could increase the cost of energy if offshore wind projects become less economically viable.
- May negatively impact job creation in the renewable energy sector, specifically in the construction and maintenance of offshore wind facilities.
- Could reduce energy independence by limiting the development of domestic energy sources.
- May discourage innovation and investment in offshore wind technology.
Constitutional Alignment
The bill appears to fall under the purview of Congress's power to tax and regulate commerce, as outlined in Article I, Section 8 of the Constitution. Specifically, the bill amends the Internal Revenue Code, which is the primary mechanism for federal taxation. The disallowance of tax credits could be argued as a regulation of energy production, impacting interstate commerce. However, the bill does not appear to infringe upon any specific individual rights or liberties protected by the Constitution or its amendments.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).