During a teleconference call with reporters, U.S. Senator Martin Heinrich (D-N.M.), a member of the Senate Committee on Energy and Natural Resources, and U.S. Congressman Raúl M. Grijalva (Ariz.-03), the Ranking Member of the House Natural Resources Committee, unveiled the Tribal Tax Incentive for Renewable Energy Act, a bill the lawmakers will introduce today to allow tribal governments to take advantage of the existing federal renewable energy investment tax credit in the same way any private developer already does.
“Energy development is one of the most promising areas of economic growth for Indian Country today,” said Sen. Heinrich during the press teleconference. “Across the country, solar, wind, geothermal, hydropower, and other renewable energy development have become a source for new jobs and business opportunities. Giving tribes access to tax incentives is key to creating the kind of energy autonomy that our Native American tribes deserve.”
“For too long, unfair tax code disparities have kept Native American Tribes at an economic disadvantage,” said Congressman Grijalva. “This bill helps Tribes take advantage of the Section 48 tax rules that have helped successful cities and communities around the country. When this bill becomes law, Tribes can start creating the clean energy jobs Congress should have been supporting years ago. Arizona and the Southwest have a great deal of open land and solar potential that deserves federal assistance. This bill is the best way to unlock that potential, and I’m excited to work with my colleague to make sure it moves forward.”
Full audio of the teleconference can be found here.
Senator Heinrich and Congressman Grijalva’s legislation would amend section 48 of the Internal Revenue Code of 1986 to allow Indian Tribal governments to transfer the full amount of the business tax credit for commercial-scale, renewable energy projects to any other taxpayer. By “monetizing” the tax credit, it can be sold to another entity and make the full benefits of the credit available to the tribal owner of the project.
According to a report by U.S. Department of Energy (DOE), Indian Country comprises 2 percent of U.S. land but contains an estimated 5 percent of all renewable energy resources. The total technical potential on tribal lands for electricity generation from utility-scale rural solar resources is about 14 billion megawatt-hours, or 5.1 percent of total U S generation potential. The Navajo Nation alone accounts for over 15 percent of the total potential resource.
Large-scale solar energy projects have incredible potential on Native lands in New Mexico, especially those located near existing power transmission lines or consumers of electric power. Allowing tribes to actively lead the development of new clean-energy resources plays a major role in addressing our nation’s climate crisis.
Below are Senator Heinrich’s opening remarks:
Thank you, everyone, for joining this call. I want to thank Congressman Grijalva for his work on this bill. I would also like to thank all of the tribal and industry stakeholders who have helped my staff and me in drafting this new legislation.
Energy development is one of the most promising areas of economic growth for Indian Country. This means tapping into traditional energy sources like oil and gas, where I am committed to working harder to streamline processes at the Bureau of Indian Affairs and the Department of the Interior. But it also applies to the rapidly growing renewable energy sector.
Across the country, solar, wind, geothermal, hydropower, and other renewable energy development has become a source for new jobs and business opportunities. Renewable energy provides 625,000 jobs nationwide. And nearly 47,000 of those jobs were added in 2014 alone. These economic opportunities need to be accessible to tribes by making the infrastructure necessary to take advantage of their natural resources attainable.
Our bill, the Tribal Tax Incentive for Renewable Energy Act, makes a simple change to the already existing federal renewable energy investment tax credit. It would allow tribal governments to take advantage of the existing 30 percent tax credit in the same way any private developer already does.
A few months ago, I sat down with the Governor of San Felipe Pueblo and a group of tribal youth. The Governor wanted me to hear directly from the next generation about their clean energy aspirations. They told me how they saw clean energy as part of a future that was compatible with the values of their history and culture.
At nearby Santo Domingo Pueblo, the tribal government recently worked with the Department of Energy to install a ground-mounted solar system that powers the community water pump and water treatment facility. This project will reduce the reservation’s power consumption by an estimated 75 to 85 percent and lead to thousands of dollars in energy savings for the Pueblo every year.
Stories like this could be replicated across Indian Country if the right policies are put in place.
Giving tribes access to renewable energy tax incentives is key to creating the kind of energy autonomy tribes deserve.