The Senate tax-writing committee took a step closer today to extending the deadline to start construction of wind, geothermal, biomass, landfill gas and ocean energy projects for another two years through December 2016.

The committee formally set July 21 as the date when the committee will vote on a bill extending expiring tax benefits.

It also released the "chairman's mark," or the proposal on which the committee chairman, Senator Orrin Hatch (R-Utah), and the ranking Democrat, Senator Ron Wyden (D-Oregon), plan to ask the committee to vote.

The chairman's mark proposes two-year extensions of as many as 52 tax benefits.

The list includes a two-year extension of the construction-start deadline for new wind, geothermal, biomass, landfill gas and ocean energy projects. Such projects would have to be under construction by December 2016 to qualify for production tax credits on the electricity output. The owner could claim a 30% investment tax credit instead.

The list also includes a two-year extension of the 50% depreciation bonus. This is the ability to deduct 50% of "tax basis" in new equipment immediately and depreciate the other 50% over the normal depreciation period. The extension would apply to equipment placed in service by December 2016. Some equipment with long depreciation periods and transportation equipment would have until 2017 to be put in service, but the bonus could only be claimed on basis through the end of 2016.

The 30% investment tax credit for solar and fuel cell projects is not included in the chairman's mark.

Committee members will have a chance to offer amendments during the committee meeting on July 21.

The path forward for the extenders bill remains to be worked out.

Senator Hatch has talked about folding the extenders into a larger bill to provide funding for the highway trust fund, which is used to pay for repairs of US highways and bridges and that will run out of money at the end of July. The House voted on Wednesday to keep the highway trust fund alive through December 18. Congressman Paul Ryan, chairman of the House tax-writing committee, wants this fall to try to combine international tax reforms with a bill extending the highway trust fund past year end. The House tax-writing committee is also expected to vote on its own tax extenders plan in September. The House wants to make a small number of tax benefits permanent and let the others expire. Twenty-two House Republicans, including some tax committee members, introduced a bill in April to roll back some features of the production tax credit for wind projects.

The extensions for renewable energy will come down ultimately to a negotiation between the House and Senate.

Keith Martin