I just got whiff of the specifics of some specifics in the proposed stimulus plan. This was just delivered to the house: TAX RELIEF INCLUDED IN “THE AMERICAN RECOVERY AND REINVESTMENT PLAN” 

On page 5 section V there are suggestions for renewable energy. The highlight in my view is the second in the section, “Temporary election to claim the investment tax credit in lieu of the production tax credit.” (ITC and PTC respectively)

Here’s why this could be a game changer for smaller, community wind projects. The PTC is about 2 cents per kWh for ten years. This equals approximately 30% of the project cost over that time. The PTC is a credit that can only be used on passive income and cannot be used by closely held companies (yes, you, Donald Trump Inc.). The two problems here are hardly anyone has passive income (assured for ten years no less) in the amount needed to absorb the PTC for a decently sized wind project and the closely held companies rule does in fact prevent individuals from cashing in on the credits (abeit secondary to the passive income, which also prevents us).

For these reasons many community based or smaller scale projects have had problems finding investors. But now, for the next two years anyway, projects can elect to receive the ITC which is a straight up 30% tax credit. Solar technology has had the ITC option for awhile. As far as I can tell (wind expert, not solar, so I’ve yet to completely figure it out) the ITC can be taken against regular income taxes for businesses or their alternative minimum tax (AMT). Individuals can take it against personal income as well, but I am not positive that they will be able to for wind because there are two different types of ITC solar projects, residential and business, as far as I can tell. (any confirmation or otherwise would be welcome in the comments section!)

So 2 million dollar community wind turbine goes up and BAM, 600k falls into your hands. This is going to be huge. Now Americans at large can finally find ways to invest in their own futures rather than leaving it up to *Ahem…* Lehman and Bear Sterns…