National Venture Capital Association
April 19, 2007

The Honorable Charles B. Rangel, Chairman
House Committee on Ways and Means
1102 Longworth House Office Building
Washington, DC 20515

The Honorable Jim McCrery,Ranking Member
House Committee on Ways and Means
1102 Longworth House Office Building
Washington, DC 20515

Dear Chairman Rangel and Ranking Member McCrery,

On behalf of the National Venture Capital Association I am writing in support of the proposal to extend and enhance the Investment Tax Credit (ITC) for clean energy technologies. We believe that the federal government should dramatically expand financial incentives to drive the market adoption of green energy sources, with mechanisms including tax credits, subsidies, loan guarantees and other programs. In addition, Congress should consider creating incentives for the U.S. greentech companies to manufacture their products in this country.

NVCA recommends that Congress adopt a technology neutral approach that allows the marketplace, not the federal tax code, to pick technology winners and losers. To the greatest extent possible, federal policy should establish a level playing field that enables all promising energy technologies to compete. A long term extension of the Investment Tax Credit that eliminates the caps that currently apply exclusively to fuel cells would render the ITC more effective in the drive to innovate a robust and diverse set of energy technology solutions.

Venture capital investing in “Clean Tech” has more than tripled between 2005 and 2006 and we believe our industry has an important role to play in the energy arena.  However, considering the global nature of the energy crisis, we believe that by partnering with the private sector the federal government partner can drive U.S. clean energy development.