July 2005

Congress hears testimony on tax credits for LFGs

Washington, DC— Curt Ranger, president of DTE Biomass Energy, Inc., testified before the U.S. House Ways and Means Subcommittee on Select Revenue Measures regarding tax credits for landfill gas facilities. Ranger, who is also the chairman of SWANA’s Landfill Gas Advocacy Committee, spoke about the importance of expanding and increasing the tax credit for landfill gas-to-electricity that was included in last year’s American Jobs Creation Act.

Also referred to as a “section 45 credit,” this section of the Internal Revenue Code gives a tax credit per kilowatt hour (kWh) for renewable energy generators. The credit currently provides 0.9 cents per kWh over a period of five years. However, the eligibility, or “placed in service,” window, is due to expire at year’s end.

In his testimony, Ranger stated, “If Congress enacts an extension of the current December 31, 2005 placed-in-service deadline, many more projects could come on-line. Based upon EPA estimates, over 500 landfill gas-to-energy projects can still be developed, and based upon DTE’s experience, extending the construction deadline three years would enable the landfill gas industry to build up to 150 of these projects.

Furthermore, if the landfill gas industry was afforded the same provisions as other renewable energy resources, such as ten-year credit periods, five-year placed-in-service deadlines, and full tax credit value for electricity produced from landfill gas, Congress could enable the development of most of the EPA’s 500 viable candidate sites.”

SWANA’s Landfill Gas Advocacy Coalition has been in operation for over seven years, working towards implementation of broader tax relief for landfill gas-to-energy facilities as an incentive to place more of these alternative energy generators into operation. The coalition consists of concerned members of SWANA’s Landfill Gas Technical Division, as well as major organizations in the landfill gas-to-energy field.


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