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How U.S. Tax Reform Can Lead to a More Energy-Efficient Industrial Sector

As the United States begins to ponder tax reform next year, we have an opportunity to create a new corporate tax structure that encourages investments that benefit society, such as energy efficiency, as well as the businesses that make these investments. In the report, “Industrial Energy Efficiency and Tax Reform,” the American Council for an Energy Efficient Economy (ACEEE) analyzes current tax reform proposals with the purpose of understanding the potential each has to encourage investments in the industrial sector in general and in energy efficiency in particular.

Encouraging industrial modernization is important to energy efficiency because the energy intensity of manufacturing correlates directly to the vintage of the equipment. As older, less efficient equipment is replaced with newer, more efficient equipment, we can anticipate the energy needed to produce a good or service will decrease. Therefore, in addition to encouraging energy efficiency outright, it also makes sense to encourage industrial modernization.
 
Read the report “Industrial Energy Efficiency and Tax Reform.”
 
Read the ACEEE blog post summarizing the report.

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