A number of harmful forced electrification bills are still pending before the Maryland General Assembly. MAHPBA has been engaged throughout on these critical issues, and members should continue their outreach to legislators during the closing month of the legislative session. Here is an update on the state of play for these bills:
SB528 has been jointly assigned to the House Environment & Transportation and Economic Matters Committees after it passed the Senate on March 14. A hearing date has yet to be scheduled in the House. The Senate stripped out the statewide prohibition on fossil fuels in new construction and watered-down a mandated greenhouse gas emission reductions for buildings. However, it added language that would explicitly allow counties, if they choose, to ban heating oil and propane or force electrification when replacing HVAC or water heating systems.
HB831, HB708, and HB806 are still alive in the House but no action has been taken on them to date. MAPDA expects the House will use SB528 moving forward.
WHAT CAN YOU DO TO HELP DEFEAT THESE BILLS?
Contact your legislators using our grassroots tool.Please share this link with your employees and customers, and feel free to PERSONALIZE the email text with specific details on your business.
All across the country, a number of states and localities have implemented or proposed policies that restrict the use of gas appliances in homes and businesses. In an effort to educate our membership and their customers, and to dispel the myths created by the electrification movement, we have created this page as a resource for information.
If you have any questions or if you are aware of pending pro-electrification initiatives in your locality, please reach out to MAHPA at email@example.com or to one of our Government Affairs Committee Directors (listed below).
For your reference, we have created an informational flyer and brochure. In addition, we have created state-specific websites for states that have pending electrification legislation:
New Jersey’s Energy Master Plan (NJEMP) requires zero-carbon fuels by 2050. While we support efforts to reduce carbon emissions, the NJEMP would require all space and water heating to be electric, eliminating affordable natural gas and propane as options. This will put the gas hearth industry in jeopardy and cost consumers $20,000 to switch to electric heat in their homes.
Senator Vin Gopal has announced that he will introduce legislation after the election prohibiting the N.J. Department of Environmental Protection and the N.J. Department of Community Affairs from adopting regulations mandating solely electric heat.
JANUARY 11, 2021 UPDATE: Out with the old and in with the new! A spending legislation and pandemic relief package was signed into law at the very end of December and included a long sought-after tax credit for wood and pellet heaters. These systems, whether they are stoves purchased to heat space or larger, whole home heating systems, will now qualify for a renewable energy investment tax credit (Section 25(D) of the Internal Revenue Code). Up until now, only solar, small wind, fuel cell, and geothermal systems qualified for this credit.
Beginning in 2021, consumers buying highly efficient wood or pellet stoves or larger residential biomass heating systems will be able to claim a 26% tax credit that is uncapped and based on the full cost (purchase and installation) of the unit. The credit will remain at 26% through this year and next, and then step down to 22 percent in 2023. This provision is part of the BTU Act, which has been actively supported by HPBA for the last several years and has been part of our Advocacy Day requests to Members of Congress.
NOTE: The language that made it into the final spending package eliminates the Sec. 25(C) credit for biomass stoves. The Sec. 25(C) tax credit may still be claimed on your 2020 tax return for qualifying purchases and installations completed before December 31, 2020.
Major Biomass Stove Tax Credit Changes in 2021 Legislation is about to pass Congress which creates a NEW tax credit for biomass heaters under Sec. 25(D) of the U.S. tax code. The Sec. 25(C) tax credit for biomass stoves is only available for qualifying products installed on or before December 31, 2020. After December 31, 2020, the new tax credit eliminates the old 25(C) tax credit. The Sec. 25(C) tax credit may still be claimed on your 2020 tax return for qualifying purchases and installations completed before December 31, 2020.
What is this new tax credit?
Effective Dates: The new tax credit under Sec. 25(D) of the U.S. Internal Revenue Code (“IRC” or “tax code”) will come into effect on January 1, 2021 for qualifying purchases and installations completed on or after that date, through December 31, 2023.
Credit Amount: Creates a new tax credit of 26 percent of the purchase and installation costs (with no cap or lifetime limit) under Sec. 25D of the U.S. tax code
Qualifying Products: Require qualifying products (any biomass-fueled heater) be at least 75 percent efficient per the higher heating value (HHV) of the fuel
The IRS will likely publish additional guidance on product eligibility in 2021
What happens to the 25(C) tax credit?
This legislation eliminates the tax credit for biomass stoves under IRC Sec. 25(C) starting in 2021 and enacts this provision in its place
Any product purchased in 2020 that qualifies for the new Sec. 25(D) credit, but isn’t installed until 2021, can be claimed under the Sec. 25(D) credit on a 2021 tax return. Products may be claimed on the tax return year in which the product installation is complete.
HPBA will continue to update our website with additional information and new materials as we learn more. Please contact Rachel Feinstein if you have any questions.