Tax-credit debate imperils wind power

Extension crucial to its survival

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U.S. wind power faces an uncertain future as lawmakers grapple over whether to extend a key tax credit that has for years helped the business compete financially with fossil fuels.

The Production Tax Credit (PTC) is set to expire at the end of this year, and the American Wind Energy Association estimates that more than 37,000 jobs could be lost if it’s not renewed. Industry leaders fear that conservative Republicans, particularly tea party members, could derail an extension in their rush to cut as much federal spending as quickly as possible.

“I don’t think I’ve ever seen a phenomenon like the tea party, people that have one agenda item and that is to cut the budget, period, without regard to the consequences,” said Jimmy Glotfelty, executive vice president of external affairs at Clean Line Energy Partners, in an interview with Washington Times editors and reporters on Tuesday.

“That’s the challenging dynamic this year. It’s that versus jobs,” he said.

A wind turbine is part of the First Wind project in Sheffield, Vt. Gov. Peter Shumlin wants Vermont to get 90 percent of its energy needs from renewable sources by 2050. If the goal can be accomplished, it would largely eliminate the state's reliance on fossil fuels. (Associated Press)

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A wind turbine is part of the First Wind project in Sheffield, ... more >

Mr. Glotfelty, whose company builds wind power transmission lines, was joined by other industry leaders who are now furiously making their case to both the public and members of Congress.

John A. Purcell, vice president of wind energy at Leeco Steel, which provides raw materials for wind farm projects, went so far as to invoke the name of the late Ronald Reagan in a plea to conservatives.

“If he were here, he would support this. It is truly an American success story,” Mr. Purcell told The Times. “I think [support is] there on both sides of the aisle.”

Mr. Purcell also stressed that he thinks the wind industry, within 10 years or less, “will not only be competitive, but it will be the lowest cost” energy source and will be capable of dethroning oil, natural gas and coal without government assistance.

But the industry’s reliance on the PTC, which offers an incentive of about 2 cents per kilowatt hour of wind power, has given its critics more ammunition to argue that without taxpayer backing, the business would flat-line.

Republican presidential front-runner Mitt Romney, among others, has blasted wind, solar and other so-called green fuels as being entirely uncompetitive on a level playing field.

“We should not be in the business of steering investment toward particular politically favored approaches,” the former Massachusetts governor wrote in his economic blueprint, released last September.

“The failure of windmills and solar panels to become economically viable or make a significant contribution to our energy supply is a prime example. At current prices, these technologies make little sense for the consuming public but great sense only for the companies reaping profits from taxpayer subsidies,” Mr. Romney wrote.

Last year’s high-profile bankruptcy of solar power giant Solyndra, which received around $530 million in federal loan guarantees before going out of business, has only fueled the belief that the Obama administration is hell-bent on pushing renewable energy sources at any cost. The wind industry points out, however, that unlike Solyndra, it is only advocating the current tax credits not loan guarantees that could leave Uncle Sam holding the bag.

“There’s nothing that we’re asking for upfront that would just dissolve, and taxpayer money that would be wasted,” Mr. Purcell said.

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