Tax reform may slow cogeneration development

Journal Article · Mon Dec 02 04:00:00 EST 1985 · Energy User News; (United States)

OSTI ID:6312549

Barber, J

A House tax reform proposal eliminates the 10% investment tax credit for the construction of cogeneration facilities and accelerated depreciation schedules will slow the development of cogeneration. Under current law, cogenerators pay about 53 cents on every dollar invested, but the proposal would change this to 81 to 83 cents on the dollar invested. It also extends the current 5-year depreciation to 20-25 years. The cogeneration industry will lobby to restore some of the incentives as the bill moves through Congress, but substantive changes are more likely to occur in the Senate. Final tax reform legislation is not expected before mid-1986. Two other elements of the bill, a cut in corporate tax rates and changes in taxes on industrial development bonds for private purposes, could also damage cogeneration projects. The proposal calls for a transition period. A table compares the proposal with current law and the Reagan plan.

• OSTI ID: 6312549
• Journal Information: Energy User News; (United States), Journal Name: Energy User News; (United States) Vol. 10:47; ISSN EUSND
• Country of Publication: United States
• Language: English

Related Subjects

29 ENERGY PLANNING, POLICY, AND ECONOMY
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293000 -- Energy Planning & Policy-- Policy
Legislation
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32 ENERGY CONSERVATION, CONSUMPTION, AND UTILIZATION
320603 -- Energy Conservation
Consumption
& Utilization-- Municipalities & Community Systems-- Public Utilities-- (1980-)
COGENERATION
DEPRECIATION
DEUS
ENERGY FACILITIES
ENERGY SYSTEMS
FINANCIAL INCENTIVES
GOVERNMENT POLICIES
INVESTMENT
LAWS
LEGISLATION
POWER GENERATION
STEAM GENERATION
TAX CREDITS
TAX LAWS