Opinion: Let Renewable Industry Use MLPs

With Republicans controlling the Senate, Democrats controlling the House and President Trump in the White House, the political challenges to find consensus and pass any comprehensive tax bill in this Congress will be daunting. Democrats on the House Ways and Means Committee will likely execute a two-track strategy that seeks first, to pass tax legislation that has bipartisan support; and second, to introduce legislation and conduct hearings that define the Democratic priorities leading up to the 2020 election.

One proposal that accomplishes both goals is to allow the renewable energy industry to utilize an important tax provision known as a master limited partnership (MLP).

The nation’s energy policy is inextricably connected to the nation’s tax code, and for over three decades, MLPs have been a fundamental tax break for fossil fuel-based energy projects. The use of MLPs has been an important tool to attract private investment and capital at lower costs.