Impacts of Financial Collapse on Trading and Taxing Carbon. By Curt Barry, Carbon Control News, October 1, 2008, subscription. “A source with the Carbon Tax Center (CTC), which favors the implementation of a sweeping carbon tax to lower GHG emissions rather than a cap-and-trade program, says the unprecedented effects to major financial institutions may cripple the prospects for cap-and-trade legislation in Congress. ‘The firms that would be managing and conducting the trading — some of them have ceased to exist and are having to restructure,’ the source says. ‘More broadly, there’s just obviously a virulent distrust of so-called market measures, or measures that inherently require the creation of new markets that will be managed and manipulated by insiders. So there is just a real hill to climb for cap-and-trade, as an institution, that can win public acceptance and command public trust.’ Further, cap-and-trade programs may grow less attractive to federal policymakers as energy prices drop, the CTC source says. While a carbon tax would ensure a certain amount of money is collected by the government from year to year, a cap-and-trade program and its price on a ton of carbon emissions is a constant unknown, and will decrease as energy prices fall, the source says.”

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Tax Incentives for Renewables Restored in Bailout Bill. By Jim Abrams, AP, October 4, 2008. “Millions of taxpayers, thousands of businesses and groups as diverse as solar power developers and natural disaster victims will see tax relief with the House vote Friday to approve and send to the president a $700 billion financial rescue plan. The tax relief package attached to the rescue bill promotes renewable energy development and extends dozens of tax breaks from the critical research and development tax credit to breaks for such narrowly focused groups as motor sports racetrack owners, film producers and bicycle commuters… The renewable energy incentives include an eight-year extension of investment credits for solar energy, as well as breaks for wind, geothermal and other alternative sources. The solar industry says extension of the credits through 2016 would produce an extra 440,000 jobs and more than $230 billion in investments.”

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‘Dirty Fuels’ Profit by Bailout Bill’s Tax Breaks for Renewable Energy. By Julie Cart, LATimes, October 4, 2008. “The renewable-energy tax incentives tucked into the financial bailout package passed by the House on Friday include billions of dollars in breaks for old-fashioned fossil-fuel processes such as liquefying coal and squeezing petroleum out of sand and rock… Critics of the measures note that the breaks run counter to the carbon-reduction message Congress intended when it vowed to bankroll clean, renewable technology. And a substantial portion of the tax breaks go to energy companies already flush with record oil profits. ‘This is deeply offensive that they would attach this massive lobby goodie bag to a bill,’ said Tyson Slocum of Public Citizen, a Washington-based public interest organization. ‘This is a gravy train. The American people are suffering here, and oil companies are getting a tax break. Not even clean energy. This is not a way to make laws’… The provisions are found in the complicated tax-extenders legislation tacked on by the Senate after the House rejected the original bailout package. Although House members were adamant that the overall tax provisions remain revenue-neutral, the add-ons will cost taxpayers more than $100 billion, according to the Congressional Budget Office. Managers in the Senate said the energy provisions were needed to make the bailout more palatable to some Western members.”