White House Readying $5 Billion in Green Tax Credits

By ELIZABETH WILLIAMSON
WASHINGTON -- The White House will announce plans Wednesday to provide another $5 billion in tax credits for manufacturers of wind, solar, electric vehicle and other renewable energy products, hoping to leverage at least $15 billion in private investment and create "tens of thousands" of jobs.
The expansion would increase three-fold the $2.3 billion available in the Section 48C Advanced Energy Manufacturing Tax Credit program, part of the $787 billion stimulus package enacted in February. That program has been over-subscribed. The additional money could go to applicants turned down when the money ran out.
Vice President Joe Biden will make the announcement at a Wednesday meeting with business leaders to discuss the future of manufacturing.
The initiative is another facet of a plan to boost job growth unveiled by President Barack Obama in a speech last week in which he said he would focus on energy-efficient home retrofitting and expanding existing stimulus energy programs to quickly create green jobs. The president discussed the retrofitting program, dubbed "cash for caulkers," in an appearance at a suburban Washington Home Depot store Tuesday.
Under heavy pressure to lower the nation's 10% unemployment rate, the president, Mr. Biden and top economic advisers have focused on "green" programs tested elsewhere, like cash for caulkers, or expanding programs already in the stimulus as among the speediest ways to fuel job growth.
But the administration still needs to hammer out the details of its green energy initiatives with Congress, which will not craft legislation until January at the earliest, the White House and congressional leaders say.
"These investments plant the seed of a new domestic manufacturing industry in clean energy that will provide tens of thousands of good, middle class jobs in America," said White House economic adviser Jared Bernstein. The administration says programs like the business tax credit will help "tap the job creating potential of manufacturing in this country," Mr. Bernstein said.
Whether the retrofitting program would take the form of a grant, rebate, or tax credit is yet to be determined, and White House officials said it was too early in the planning process to estimate its cost.
Mike Thaman, chief executive of Owens Corning, an insulation and building materials at manufacturer, who was with the president at the Home Depot store Tuesday, said a successful program in Australia provided a $1,500 tax credit per home. By that measure, a program covering the 100 million homes in the U.S. could cost up to $15 billion.
"The Australian program is a pretty good benchmark," he said. "Certainly we've seen that as a very simple and focused program."
Write to Elizabeth Williamson at elizabeth.williamson@wsj.com