Congress Passes Extension of Wind Production Tax Credit
As the U.S. Congress approved a plan Tuesday to veer away from the “fiscal cliff,” wind energy advocates embraced the bill’s extension of a wind production tax credit that was set to expire at the end of 2012.
The one-year extension of the credit, which gives wind companies a rebate of 2.2 cents for every kilowatt hour produced, would cover all projects that start construction in 2013. The bill awaits President Obama’s signature.
The wind power industry decried the tax credit’s expiration as the end of the year approached, and some companies laid off workers in anticipation. The American Wind Energy Association said that the preservation of the credit will save up to 37,000 jobs, and allow the industry to “keep growing a new manufacturing sector that’s now making nearly 70 percent of our wind turbines in the U.S.A.,” interim CEO Rob Gramlich said in a statement responding to the extension. (See related post: “Wind Industry Fights to Save Tax Credit Before Its Expiration Date.“)
Critics of the credit, including Sen. Lamar Alexander (R-Tenn.), argue that the cost, which is estimated at $1.2 billion per year over 10 years, is both too high and unnecessary. But the credit did have bipartisan support led by Sen. Mark Udall (D-Colo.), Sen. Charles Grassley (R-Iowa), and others in states with a stake in the wind industry’s growth.
Wind power accounted for 3 percent of all U.S. electricity generation in 2011, according to the Energy Information Administration. A 2008 report by the Department of Energy laid out a scenario envisioning 20 percent wind power generation in the U.S. by 2030, a goal it said was “ambitious,” but “feasible” if certain challenges, including necessary upgrades to the electric grid and turbine manufacturing growth, are addressed. (See related post: “As U.S. Eyes Offshore Wind Development, Whales Get New Protections.“)
