NY Looks to Eliminate Alt Fuels Tax Credit, Reward Polluting Petroleum

John Davis

patersonNew York’s governor wants to get rid of a tax credit for alternative fuels and fuel cells, while keeping a much more expensive credit for a very dirty form of diesel.

Environmentalists are up in arms over Gov. David Paterson’s plan to cut the $5 million in credits, which he says are underutilized, at a time when companies are poised to launch technology to better take advantage of those incentives, according to this article from Crain’s Insider:

But cutting the credits, even if they are not working as planned, doesn’t square with the governor’s environmental message, says Carol Murphy, executive director of the Alliance for Clean Energy.

“It’s a major disconnect,” she says. “Maybe they were underutilized because the products weren’t there yet.”

Murphy points out that companies like Albany-based Plug Power, which employs 120 people throughout the state, are ready to unveil new fuel-cell lines. Ending the credits just as new products are coming to market might harm companies that could help revive the upstate economy.

David Gahl of Environmental Advocates of New York says the state would do better by eliminating a credit for bunker fuel. Gahl estimates the state loses more than $30 million each year in credits for the fuel, a form of diesel used mainly in cargo ships. The fuel, which is high in pollutants that cause acid rain and smog, can also be used in some power plants, including three in New York City.

Amazing, huh? Five million dollars is too expensive for the state to spend for clean air, but $30 million is OK for more pollution. Go figure!

Government, Miscellaneous