Powering Strong Communities

Ditto says public power access to clean energy tax incentives is ‘low hanging fruit’

Allowing public power utilities to have access to clean energy tax incentives is “low hanging fruit” in terms of policy-related action that can be taken in the short term in order to incentivize not-for-profit utilities to build their own clean energy generation, said Joy Ditto, President and CEO of the American Public Power Association (APPA) on March 22.

She made her comments while participating in a panel at the Sixth Annual Sustainable Energy Week sponsored by The Economist. The panel discussed how utilities can prepare their business models for the future.

“U.S. electric utilities overall have actually done quite a bit to address climate change in the last fifteen years,” Ditto pointed out. “We have more to do, but we have reduced greenhouse gas emissions thirty percent since 2005,” which she said is attributable to a number of factors.

“One is there has been some form of incentive for clean energy production since the 1992 Energy Policy Act, and more was added in the 2005 act and subsequently, particularly related to clean energy tax incentives” that investor-owned utilities and independent power producers can take advantage of. This helps to explain why there has been “an exponential growth in wind, solar and other clean energy technologies,” Ditto said.

But the not-for-profit electric sector is not able to take direct advantage of those tax incentives. Allowing not-for-profit utilities to have access to these clean energy tax incentives is a “low hanging fruit that we could do in the very short term to incentivize not-for-profit utilities to build their own clean energy generation going forward.”

Meanwhile, Ditto noted that there have been technology improvements in terms of electrification.

She noted that there is “a very major focus” in the U.S. on electric vehicle deployment including among public power utilities that are putting in place programs to incentivize EVs and the infrastructure to support them.

Moreover, public power utilities are hearing from their customers that they want to decarbonize to reduce greenhouse gas emissions and they often want to contribute to that locally, Ditto said.

There has been an influx of community solar programs “particularly within our membership and other ways to improve the clean energy landscape.” Even in the absence of federal legislation “we’ve seen great strides made in this country.”

If federal policy does emerge in the short term under the Biden Administration, APPA believes that Congress should pass an economywide bill to address greenhouse gas emissions, “as well as to focus on the reliability and affordability of electricity as we move forward,” Ditto said.