House version of BTU Act introduced

By Anna Simet | July 23, 2013

Rep. Mike Michaud, R-Maine, has introduced the House version of the Biomass Thermal Utilization Act of 2013, which was introduced to the Senate in May by Sen. Angus King, I-Maine.

The BTU Act provides incentives to install residential, commercial and industrial biomass heating systems by modifying renewable energy provisions of the current tax code. Altering Section 25D, the act would provide a 30 percent investment tax credit to qualifying residential heating systems, as it already does for many other renewable energy technologies. To be eligible for the credit, systems must operate at a thermal efficiency rate of 75 percent, and be used to heat homes or water.

The bill also changes Section 48 to provide a tiered tax credit for the installed cost of biomass-fueled heating or cooling systems for commercial or industrial applications. Qualifying biomass heating property must operate at thermal output efficiencies of at least 65 percent and be used to generate heat, hot water, steam, or industrial process heat. The credit would be two tiered—for technologies that operate at thermal output efficiencies between 65 and 80 percent; the investment tax credit is limited to 15 percent of installed capital cost. Technologies operating at thermal output efficiencies greater than 80 percent would be eligible for the full 30 percent investment tax credit.

Both credits would have no maximum and be available for systems placed in service on or before December 31, 2016.

The bill was assigned to the House Ways and Means Committee on July 17, which will consider it for passage on to the House.