SCHUMER ANNOUNCES LEGISLATION TO EXPAND AND IMPROVE TAX BREAK TO COVER FUEL CELLS FOR OFF-HIGHWAY VEHICLES; LEGISLATION WOULD PROVIDE SHOT IN THE ARM FOR CAPITAL REGIONS PLUG POWER, A NATIONAL LEADER IN FUEL CELLS FOR FORKLIFTS
Current U.S. Tax Law Gives Boost to Fuel Cells Designed for Cars Trucks and Power Generation - But Excludes Fuel Cells For Forklifts and Other Off-Highway Vehicles Plug Power Produces This Type of Fuel Cell; Expanding Credit Would Provide Huge Boost For Company and Its Suppliers Across New York, Creating Jobs Locally and Across State Schumer Legislation Would Expand Fuel Cell Tax Credit, Give Plug Power Same Tax Break As Other Fuel Cell Producers
Today, U.S. Senator Charles E. Schumer announced legislation to improve the tax credit for fuel cellpowered industrial vehicles, which will greatly benefit companies, like Plug Power Inc., that build fuel cells designed for forklifts and other heavy machinery. An existing tax credit provides significant incentives to buyers of fuel cells for cars and trucks and a separate credit for power generation, but neither credit specifically targets fuel cells designed for heavy machinery and offhighway vehicles. Today, Schumer unveiled legislation in the Senate to match that of Congressmen Paul Tonko and Chris Gibson in the House of Representatives, to modify these existing tax credits to more clearly cover the GenDrive ® fuel cells that Plug Power manufactures. Schumer notes that modifying the credit would provide Plug Power and its suppliers with a significant boost and could potentially create hundreds of jobs locally and throughout the state. Schumer said that these types of fuel cells are big business and a major part of Plug Power's future.
"Fuels cells save energy and help the environment regardless of whether they're attached to a car or a forklift, and this new legislation will ensure that companies that produce either type of vehicle are treated equally," said Schumer. "By expanding this tax credit, we have the potential to create hundreds of jobs here in the Capital Region and to allow Plug Power, one of the world's preeminent manufacturers of fuel cells, to grow their business."
Senator Schumer's legislation is intended to amend section 30B of the Energy Policy Act of 2005, also known as the Alternative Motor Vehicle Credit (AMVC). The proposed legislation expands the definition of "fuel cell motor vehicle" to include fuel cellpowered material handling vehicles. Changes to the AMVC will provide tax credits for companies to invest in fuel cellpowered industrial vehicles, providing additional economic incentives to Plug Power's customers and industry partners.
The bill also provides a new qualified fuel cell motive property credit based on a vehicle's kilowatt capacity - an objective, widely accepted and verified industry standard of measurement.
Extending the tax credit to buyers of these fuel cell products would boost an industry that is a proven job creator in New York State. By incentivizing the purchase of these vehicles, the legislation would allow local businesses like Plug Power to ramp up their operations and potentially add jobs. The Department of Energy currently estimates that the domestic fuel cell industry will create 40,000 jobs over the next ten years, but those jobs could be at risk if more domestic producers are not allowed to utilize the AMVC credit. Passing the tax credit will mean a break of between $8,000 and $40,000 for buyers, depending on the kilowatt capacity or weight of the fuel cell material handling vehicle.
Plug Power currently houses its national headquarters in Latham where it employs over 100 New Yorkers. During 2010 the company increased its workforce by 20% and has already begun to emerge as a national leader in fuel cell commercialization and deployment. Unlike many alternative energy industries, fuel cells are predominantly made in the United States. For every 50 additional fuel cell orders, about one manufacturing job is created on site, with job creation trickling down through the supply chain as well. Importantly, the success of companies like Plug Power have ripple effects throughout the economy, and it is important to consider this as one of the economic benefits witnessed because of the tax credits.
"The expansion and improvement of the tax law is a result of the impressive relationship Senator Schumer has been able to establish with companies within the fuel cell industry," said George McNamee, Chairman of the Board of Directors for Plug Power. "His dedication to the commercialization of alternative energy solutions will only make our Capital Region, State and Nation stronger."
Schumer notes that this legislation would also benefit a number of other New York companies, particularly the Raymond Corporation in Greene and Onondaga Counties, and Praxair in Tonawanda, in Western New York. Raymond currently employees approximately 1,110 people at their Greene and East Syracuse facilities. Praxair currently employs 1,100 people at their Tonawanda facility. They recently identified green hydrogen production as an area for market expansion and green job growth.
A fuel cell is an electrochemical device that combines hydrogen and oxygen to produce electricity, with water and heat as its byproduct. As long as fuel is supplied, the fuel cell will continue to generate power. Since the conversion of the fuel to energy takes place via an electrochemical process, not combustion, the process is clean, quiet and highly efficient - two to three times more efficient than fuel burning.
According to assessments by the National Academies and the Hydrogen Technical Advisory Committee, fuel cell technology is not only meeting and exceeding the government's longterm research and development plan, but it is also on track to achieve commercial viability by 2015. As the U.S. considers pathways to achieve aggressive goals for gas and greenhouse gas reductions, it is critical to develop diverse technological options, like fuel cells.
Other countries are aggressively pursuing hydrogen and fuel cells including Japan and Germany, which plan early commercialization in 2015. Schumer notes that while U.S. is currently a leader in automotive fuel cell technology, it must continue to invest in this research to remain a leader, particularly in places like the Capital Region. The region is an emerging national hub for clean energy technologies and is home to production plants like Plug Power that employ many New Yorkers. Passing Schumer's legislation would allow manufacturers like Plug Power to potentially add hundreds of jobs.
"Senator Schumer's progressive legislation sheds light on the remarkable affects that fuel cell market growth can bring to New York State," said Andy Marsh, CEO at Plug Power Inc. "By helping to commercialize sustainable fuel cell power solutions, thousands of green jobs will be created in manufacturing, engineering and supply chain domestically."
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