Utilities in the United States each year save billions of dollars due to federal and state tax loopholes, money that could instead be funneled into energy efficiency programs, according to a report issued Wednesday by the Institute for Policy Studies. “Of the 40 U.S. publicly held utilities companies that were profitable in 2015, 23 paid no federal income taxes and 16 paid no state taxes,” the report says.
According to the report, many of these utilities oppose the Environmental Protection Agency’s Clean Power Plan, carbon emissions standards for existing coal-fired power plants, because it would require expensive investments in clean energy sources. “A cheaper, faster route to achieving the Clean Power Plan goals would be to reduce electricity demand through improved energy efficiency. This report calculates how much additional revenue would be available for investment in energy efficiency if utilities paid their fair share of taxes,” the report says.
If those 40 utilities had been taxed at a rate at least as high as retailers, “which are similarly tethered to U.S. communities,” according to the report, federal and state revenue would increase $14.1 billion annually. “The $14.1 billion in extra revenue that could have been generated through fair taxation is nearly double the amount state governments and utilities spent on energy efficiency in 2015. It would be enough to create more than 88,000 energy efficiency jobs or weatherize homes for up to 3 million low-income families,” the report concludes.
