Renewable Energy Consulting – PPA Partners, LLC

The US Congress has released a draft bill that would provide tax credits for manufacturers of renewable energy equipment and funding for other sources of clean energy.

House Ways and Means Committee Chairman Sander Levin, D-Mich., unveiled the draft legislation which aims to encourage domestic manufacturing of energy equipment and renewable fuel development.

The proposed legislation would modify the Section 48C advanced manufacturing tax credit to provide an uncapped 30 percent investment tax credit for expenditures to re-equip, expand or modify facilities that manufacture and fabricate solar energy property, fuel cell power plants, and advanced energy storage systems (including batteries for advanced vehicles).

The proposal would extend for two years (through 2012) and codify the direct payment in lieu of tax credit program that was initially created by Section 1603 of the American Recovery and Reinvestment Act of 2009 for renewable energy facilities (e.g., wind, solar, and biomass facilities), combined heat and power facilities, fuel cells and microturbines that qualify for the production tax credit and investment tax credit. Among other technical improvements, the proposal would clarify that real estate investment trusts may participate in the program.

Under current law, residential fuel cells are eligible for a 30 percent investment tax credit (capped at $1,000 per kilowatt hour of capacity). Commercial fuel cells are eligible for a 30 percent investment tax credit (capped at $3,000 per kilowatt hour of capacity). The proposal would harmonize the capacity limitation of residential fuel cells to the capacity limitation of commercial fuel cells (i.e., $3,000 per kilowatt hour of capacity). Furthermore, the proposal would allow micro-combined heat and power systems to qualify for the 30 percent investment tax credit for residential energy efficient property.

The proposal would also extend the 50 percent investment tax credit for alternative vehicle refueling property for three years (through 2013). The proposal would also make modifications clarifying the availability of this credit for electric vehicle refueling pump property and for property that fuels non-motor vehicles that run on hydrogen fuel cells.

Source: Fuel Cell Today

Hydrogen is the simplest element. An atom of hydrogen consists of only one proton and one electron. It’s also the most plentiful element in the universe. Despite its simplicity and abundance, hydrogen doesn’t occur naturally as a gas on the Earth – it’s always combined with other elements. Water, for example, is a combination of hydrogen and oxygen (H₂O).

Hydrogen is also found in many organic compounds, notably the hydrocarbons that make up many of our fuels, such as gasoline, natural gas, methanol, and propane. Hydrogen can be separated from hydrocarbons through the application of heat – a process known as reforming. Currently, most hydrogen is made this way from natural gas. An electrical current can also be used to separate water into its components of oxygen and hydrogen. This process is known as electrolysis. Some algae and bacteria, using sunlight as their energy source, even give off hydrogen under certain conditions.

Hydrogen is high in energy, yet an engine that burns pure hydrogen produces almost no pollution. NASA has used liquid hydrogen since the 1970s to propel the space shuttle and other rockets into orbit. Hydrogen fuel cells power the shuttle’s electrical systems, producing a clean byproduct – pure water, which the crew drinks.

A fuel cell combines hydrogen and oxygen to produce electricity, heat, and water. Fuel cells are often compared to batteries. Both convert the energy produced by a chemical reaction into usable electric power. However, the fuel cell will produce electricity as long as fuel (hydrogen) is supplied, never losing its charge.

Fuel cells are a promising technology for use as a source of heat and electricity for buildings, and as an electrical power source for electric vehicles. Fuel cells operate best on pure hydrogen. But fuels like natural gas, methanol, or even gasoline can be reformed to produce the hydrogen required for fuel cells. Some fuel cells even can be fueled directly with methanol, without using a reformer.

In the future, hydrogen could also join electricity as an important energy carrier. An energy carrier moves and delivers energy in a usable form to consumers. Renewable energy sources, like the sun and wind, can’t produce energy all the time. But they could, for example, produce electric energy and hydrogen, which can be stored until it’s needed. Hydrogen can also be transported (like electricity) to locations where it is needed.