Senators Mary Jo White (R-Venango) and Robert Tomlinson (R-Bucks) this week announced their intent to introduce the “Alternative Energy Investment Act” when the Special Session on Energy convenes next week.

Under the legislation, $60 million annually would be allocated out of existing revenues to provide grants and loans to projects geared at improving energy supply and efficiency, improved conservation and reduced demand for energy.

“This proposal is an important step as the Commonwealth prepares for the impact of expiring generation rate caps in the coming years,” said Sen. Tomlinson, chairman of the Senate Consumer Protection and Professional Licensure Committee. “Our legislation targets investment into alternative and renewable sources of energy, and provides incentives for both businesses and homeowners to reduce and improve their energy use.”

Specifically, the legislation includes:

· $20 million annually in tax credits for investments in alternative energy production projects;

· $20 million annually to finance a $250 million bond; and

· $20 million annually for consumer/home energy efficiency programs.

Tax credits would be available to facilities which:

· utilize waste coal, biofuel, biomass, solar power, wind energy, clean coal technologies or other alternative energy sources defined under the Alternative Energy Portfolio Standards Act to produce or distribute renewable energy;

· Manufacture or produce products that provide renewable energy; and

· Are used for the research and development of technology to provide alternative or renewable energy sources

Bond proceeds would be allocated over a five-year period for the following:

· Development of alternative/renewable energy technologies and venture capital – administered by Ben Franklin Technology Development Authority;

· Pollution control technology projects to assist existing electric generating units meet enhanced state and federal pollution emission reduction requirements – administered by the Department of Environmental Protection; and

· Clean energy and energy conservation projects – administered by the Commonwealth Financing Authority.

Consumer and home energy efficiency funding would provide grants, rebates and reimbursements for:

· Purchases of energy efficient heating and cooling units and appliances; and

· Residential energy conservation projects, including purchase and installation costs for:

o Solar or solar photovoltaic panels,

o Energy efficient windows and doors, and

o Insulation, air-sealing and other energy saving projects.

“A sound energy policy must include efforts to expand and diversify our energy supply, while encouraging common-sense steps that can reduce demand and increase efficiency, both in our homes and businesses,” said Sen. White, chairman of the Senate Environmental Resources and Energy Committee. “We look forward to working with Governor Rendell and our colleagues in the General Assembly to adopt a sensible and responsible energy policy for Pennsylvanians.”

Funding for the Alternative Energy Investment Act will be found within existing revenues. Sen. White and Sen. Tomlinson indicated that a potential source of funding is the anticipated growth in revenues from the existing gross receipts tax on electricity, although other revenues may be identified as the proposal moves through the legislature.

House Republicans are expected to announce their own package of energy legislation next week.

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