WASHINGTON – The Senate on Thursday approved energy tax credits proposed by Maine’s two senators and aimed at helping businesses and homeowners struggling to pay their bills in the sluggish housing market.

The credits were part of a broader bill directed at the current home foreclosure crisis. The bill, which cleared the Senate overwhelmingly, 84-12, now goes to the House, which has some different ideas for easing the housing crisis.

Home prices dropped by 11 percent last year, according to a letter Sen. Susan Collins, R-Maine, sent to President Bush on April 1 urging him to act.

“In my home state of Maine, price declines are becoming an unfortunate staple of kitchen table conversation,” Collins said in the letter. “Although foreclosure filings in the state of Maine are occurring below the national pace, state officials tell me the numbers are rising and are expected to worsen.”

To help, Collins and Sen. Olympia Snowe, R-Maine, proposed measures to extend renewable energy tax credits and give homeowners a tax credit for buying more energy-efficient wood stoves.

Their proposals, which were added to the bill in committee, would extend incentives to improve energy efficiency and encourage investment in renewable electricity sources such as wind, biomass, hydropower and sun.

“We must do more than pay lip service to alternative energy production and conservation,” Snowe said, while recognizing that high energy prices are one of the reasons for the current economic downturn. Snowe also said in a January letter to Senate leaders that promoting long-term clean electricity would lower home-heating costs and stimulate job growth and the economy.

Snowe’s proposal extends for one year deductions to build more energy-efficient homes and make existing homes more efficient. Additionally, credits for using energy-efficient technology to build homes would be extended for two years and a credit for making energy-saving appliances would be extended for three years. More than 100,000 Americans could be put to work this year with Snowe’s tax credits, her letter said.

The Snowe proposals were from a 2005 energy law she sponsored that is set to expire at the end of this year.

Collins’ proposal would give $300 tax incentives to people who purchase new wood stoves or exchange their old wood stoves for newer and cleaner versions, including wood pellet stoves. The new wood stoves are 70 percent cleaner and use a third less firewood than older models. Sponsors say the new stoves are also a more healthful option, as the old stoves can aggravate asthma and bronchitis.

“Wood is a renewable resource, and its increased use for home heating is inevitable in these times of high oil prices,” Collins said. “We have the technology to make its use better for the environment and for human health, as well as safer and more affordable.”

By switching from old to new, homeowners would save on their heating bills, improve their health and help the environment, but the new stoves cost more – $1,500 to $3,000, on average – making the tax credit a needed incentive, Collins said.

In addition to renewable energy tax credits, the housing bill would also provide $10 billion in tax-exempt bonds to help first-time homebuyers and at-risk borrowers. An additional measure by Snowe would add $930 million for small states, increasing what Maine would receive from $43 million to $90 million.

Similar measures were proposed in the House by Reps. Charles Rangel, D-N.Y., and Barney Frank, D-Mass. The president unveiled his own more moderate housing plan on Tuesday.

Although the Senate bill passed by an impressive margin, even its supporters acknowledge it’s tilted too much in favor of businesses such as home builders and does little to help borrowers at risk of losing their homes.

The bill combines large tax breaks for homebuilders and a $7,000 tax credit for people who buy foreclosed properties, as well as $4 billion in grants for communities to buy and fix up abandoned homes.

The measure, titled the Foreclosure Prevention Act, will be significantly redrawn by House critics who say it favors businesses such as home builders instead of borrowers.

The Associated Press contributed to this report.