Friday, November 16, 2012

What's Next for Wind?

At a press conference this week in Washington, D.C., Iowa Sen. Charles Grassley called on Congress to pass at least a one-year extension of the wind energy production tax credit (PTC). Grassley is part of a non-partisan group of governors and members of Congress who support the tax credit and say that the U.S. economy will lose an estimated 37,000 wind industry jobs and the opportunity to leverage over $10 billion of private investment unless an extension is approved. According to Grassley, the outcome of his group's efforts depends in part on the economic policy meetings currently ongoing between President Obama and Speaker of the House John Boehner.

Meanwhile, some tax credit supporters reportedly are calling for a multi-year phase-out rather than a simple one-year extension. Those favoring this approach say developers need more than a year to finance and build wind projects. A one-year extension of the PTC is part of an omnibus tax-extenders bill passed by the Senate Finance Committee in August and awaiting further action.

Currently, the federal government provides a tax credit of 2.2 cents for every 1,000 watts of wind energy produced, but the program is scheduled to expire at the end of 2012. Those who support extending it say a tax credit helps level the playing field between the growing wind industry and competing industries such as coal that already benefit from government tax breaks. Opponents say the credit distorts the energy market and increases energy prices.

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