Capitalizing on technology would fuel manufacturing job growth, cut emissions
WASHINGTON, D.C. - U.S. Senators Tom Carper (D-Del.), top Democrat on the Environment and Public Works Committee and Ben Cardin (D-Md.) introduced legislation today advancing technology that reduces harmful emissions and conserves energy by converting wasted industrial heat to clean, usable electricity. The Waste Heat to Power Investment Tax Credit Act would provide a 10 percent investment tax credit on waste heat to power projects that begin construction before January 1, 2027. The bill enjoys widespread support from United Steelworkers International, steel producers and a range of businesses and trade associations in energy conservation and manufacturing.
“About a third of the energy consumed at American industrial facilities escapes into the atmosphere as thermal heat. By not converting this waste heat to power, U.S. manufactures are foregoing the capture of the same amount of clean energy generated by over 6,000 wind turbines. This is a huge amount of wasted opportunity that we can never get back,” said Senator Carper.“Harnessing this energy and transforming it to electricity would reduce emissions, save manufacturers billions of dollars in energy costs and create thousands of American jobs in the process. Less money spent on power bills also means more funds available for capital investments or new hires - boosting our manufacturers’ global competitiveness. We have the technology at our fingertips to make this happen, but upfront construction costs often discourage businesses from making the initial investments. My bill with Senator Cardin fixes the tax code by removing some of those barriers and helps America lead on the frontier of energy conservation.”
“Our country faces a desperate need to reduce industrial or heat emissions and conserve energy,”said Senator Cardin. “Waste heat technology has the potential to accomplish these goals, but the large investment required to deploy the technology has prevented it from reaching its full potential. I am proud to introduce this bill with Senator Carper to clarify existing law to facilitate investment in waste heat systems that will not only help the environment, but create jobs.”
This bill has earned the support from the leaders of over 60 manufacturers, trade associations and other businesses, including: Cummins, ArcelorMittal USA, the Alliance for Industrial Efficiency, the Heat is Power Association and the Sheet Metal and Air Conditioning Contractors' National Association. Read that letter of support here.
The Waste Heat to Power Investment Tax Credit Act is also endorsed by United Steelworkers International (USW):
"Our members work in hot, energy-intensive processes across the country," said USW President Thomas M. Conway. "We strongly support this proposal. It will help domestic manufacturers install waste-heat-to-power technology, reduce emissions and remain globally competitive."
Full text of the bill can be found here.
The industrial sector uses almost a third of our nation’s energy and almost a third of the energy consumed by the industrial sector is converted into thermal energy that is lost into the atmosphere. This lost thermal energy – or waste heat - could be converted into electricity and help provide a clean, cheap source of energy for the industrial sector. Money once wasted on energy costs could be used in investment elsewhere, creating good paying American jobs and making our manufacturing sector even more competitive internationally than it is today. According to the Department of Energy, there is almost 15 gigawatts (GW) – enough energy to provide electricity to an estimated 11 million homes every year - of untapped waste heat power capacity in the United States, with nearly half being in the U.S. manufacturing sector. Texas, Louisiana, California and Indiana have the largest waste heat to power potential, with 1,500 MW, 884 MW, 763 MW, 501 MW of technical potential capacity available in each state respectively. Capturing waste heat could save the industrial sector billions in energy cost savings and result in 160,000 new American jobs.
In the 2008 tax extenders package, Congress added combined heat to power technology to the list of technologies eligible for an investment tax credit under section 48 of the tax code. It was assumed that waste heat to power technology would also be able to receive tax credits under this provision. However, because of a technical error, the IRS has determined waste heat to power technology is not eligible for tax credits under section 48 of the tax code. As a result, waste heat to power has not received any tax benefits from this provision. This legislation clarifies the law by adding waste heat to power technology as eligible for investment tax credits under section 48 of the tax code.