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The following article by AWEA CEO Denise Bode appeared yesterday on the Huffington Post website.

As the prospect of Congress extending wind energy's primary incentive, the federal Production Tax Credit (PTC), has grown in recent weeks, so have both support and criticism.

On the positive side, the Des Moines Register, Denver Post, and Chicago Sun-Times have all editorialized in favor, joining a number of other major newspapers already on record in support (for example, the Daily Oklahoman, the Houston Chronicle, and The New York Times). The Wall Street Journal, meanwhile, on Friday continued its steady drumbeat of broadsides against renewable energy in general and the wind tax credit in particular.

Here is what the Journal and other critics of the PTC miss:

Historically, all energy sources have been encouraged by government, and for good reason. Ensuring a steady supply of domestic energy is vital to the productivity of our national economy.

Traditional energy sources have had a huge head start in government support. A recent study from the Congressional Research Service (CRS) points out that traditional energy sources enjoy an enormous advantage with regard to tax relief and other incentives: "For more than half a century, federal energy tax policy focused almost exclusively on increasing domestic oil and gas reserves and production … These provisions remain in the tax code in limited form today."

That advantage is permanent, allowing for a stable business environment that wind energy is deprived of because of on-again, off-again federal policies

Renewable energy sources are not receiving excessive support. Another recent report, "What Would Jefferson Do?" from DBL Investors, found that "current renewable energy subsidies do not constitute an over-subsidized outlier when compared to the historical norm for emerging sources of energy. For example: … the federal commitment to [oil and gas] was five times greater than the federal commitment to renewables during the first 15 years of each [incentive's] life, and it was more than 10 times greater for nuclear."

Wind energy's incentive is tax relief. Wind's incentive is in the form of a federal tax credit. To call tax relief a subsidy is to assume that all money belongs to the government. Rather, a tax credit simply leaves more money in private hands. In this case, anyone who makes renewable energy qualifies. The result has been the creation of over $15 billion a year in private investment and 75,000 privately financed jobs in wind power.

Wind's incentive, the Production Tax Credit, has strong bipartisan support. As Gov. Sam Brownback (R-Kan.) and Senator Jerry Moran (R-Kan.) put it in an op-ed earlier this year in the Wichita Eagle, "If we expect the wind-energy industry to provide for our country's future energy needs and make long-term investments in their businesses, Congress must reauthorize the wind-production tax credit that expires this year. By extending the wind PTC, Congress will allow the wind industry to complete its transformation from being a high-tech startup to becoming cost-competitive in the energy marketplace."

GOP strategist Karl Rove added in June that the Production Tax Credit for wind "is a market mechanism…not picking winners and losers. We're simply saying for some period of time we will provide this incentive as we scale up and get improvements in technology." He called it something Republicans and Democrats can agree on, and I believe it is.

In an editorial posted yesterday, the Bloomberg news service endorsed extending the federal wind energy Production Tax Credit (PTC) beyond its currently scheduled expiration date of Dec. 31.

Excerpts from the editorial:

"Onshore wind power has improved to the point where it is now the most competitive of all renewable energy sources except hydropower. According to recent estimates from Bloomberg New Energy Finance, it is on a path to reach 'grid parity'–the point where its cost is equal to the baseline price of power on the grid–starting in 2016. In the long run, in other words, wind can be expected to thrive without the tax credit …

"Renewing the tax credit would … enable the wind industry to return to growth, adding 54,000 jobs over the next four years, according to the American Wind Energy Association, an industry trade group. Letting the credit expire, on the other hand, would mean losing 37,000 jobs in the sector.

"The job market is not the main reason wind power is worth supporting. It’s a clean energy source, with a promising economic future as the cost per turbine continues to fall. Its prospects will become even brighter if natural gas prices, now extraordinarily low, rise in the coming years with increasing demand."

The Messenger News, a newspaper based in Fort Dodge, Iowa, has become the latest of several papers in the Hawkeye State to endorse an extension of the federal wind energy production tax credit (PTC).

In its editorial, the Messenger News notes Iowa's national leadership in wind power–the state ranks second only to Texas in installed wind generating capacity–and adds, "Making use of wind to generate electricity has enormous implications for the United States."

With respect to the PTC, the newspaper aligns itself with U.S. Sen. Chuck Grassley (R-Iowa), who authored the legislation that originally created the PTC and who has argued that it should not be singled out for elimination in the absence of more far-reaching tax reform that looks at all provisions of the tax code:

"Reforming the federal tax system to modify–or possibly eliminate–the numerous provisions that have been inserted by lobbyists and interest groups to benefit particular industries is a worthy goal. This should only happen, however, as part of a comprehensive overhaul of the tax code. Targeting the wind-energy tax credit at this time while other types of energy producers retain their special tax advantages would be unfair and would hurt an important Iowa industry …

"'No single energy tax incentive should be singled out over others, energy-related and not, before a broad-based tax reform debate,' Grassley said in a memorandum released by his office early this month. 'Congress and the President need to take up tax reform to make American business more competitive with lower rates, a broader tax base and a simpler code. Until tax reform is undertaken, workers and employers need certainty in existing tax law.'

"The Messenger agrees with Grassley. The wind-energy production tax credit should be renewed pending a much-needed, comprehensive rethinking of the tax code."

The following letter to the editor by Carol E. Murphy appeared in Sunday's edition of the Buffalo News and is reprinted here with permission of the author. Ms. Murphy is executive director of the Alliance for Clean Energy New York.

Mary Kay Barton's commentary of Aug. 14 ("Big subsidies for wind projects are 'FIT' for retirement") overlooks a number of important facts.

First, all energy sources have been subsidized over time, and wind is no exception. The question then becomes: Is the incentive that wind has been receiving excessive compared with other sources? The answer is no. A recent study from consulting firm DBL Investors concluded that "current renewable energy subsidies do not constitute an over-subsidized outlier when compared to the historical norm for emerging sources of energy."

Second, wind energy is indeed reliable and a valuable addition to our energy portfolio. Grid operators in America and worldwide already rely on wind power and successfully deploy it in large amounts. A recent study by our electric grid operator, the New York Independent System Operator, found that up to 8,000 megawatts of wind energy, or more than 20 percent of the anticipated peak load for 2018, could be added to New York's grid with no adverse reliability impact.

Furthermore, because wind is a free, locally generated and predictable fuel source, it can suppress prices by replacing electricity from more expensive generators and hedging against the volatility in fossil fuel and natural gas pricing. Testifying before the State Assembly in 2009, the Independent System Operator noted that for every 1,000 megawatts of wind on the power grid, consumers save $300 million in wholesale energy costs.

Third, wind is environmentally responsible. Data from the U.S. Department of Energy and every analysis conducted by independent utility system operators confirms states and regions that have added wind power have seen significant declines in emissions of harmful pollutants. The Independent System Operator's study found that by increasing wind generating capacity from 1,275 megawatts to 8,000 megawatts, New York could reduce pollutant emissions by 7 percent to 10 percent.

Fourth, the federal incentive for wind energy has helped provide tens of thousands of jobs in nearly 500 factories, increasing the value of domestic content in wind turbines twelvefold since 2005. Some 2,000 New Yorkers are employed by the wind industry, which has invested more than $2 billion in the state and contributes more than $10 million a year in property taxes.

Wind energy diversifies America's electricity generation portfolio and protects ratepayers by providing affordable power over the long term that is not subject to fuel price volatility.

For all of these compelling reasons, continuing to provide stable, predictable tax policy for America's wind energy industry is just common sense. Congress should extend the federal production tax credit for wind energy at the earliest opportunity.

The following article appeared in Thursday’s edition of the Helena (Mont.) Independent Record and is reprinted here with the permission of the author, Jeff L. Fox.

Past and present, Montana a leader in wind energy

In 1927, long before President Franklin Delano Roosevelt and his Rural Electrification Administration (REA) brought electricity to the countryside, Marcellus Jacobs from eastern Montana invented the three-bladed wind turbine for electricity production.

At night, the Jacobs family farm provided the best advertisement for the effectiveness of his new technology, basking alone in the glow of electric light against the dark night sky of Montana’s plains. By 1931, Marcellus and his brother Joe had founded “The Jacobs Wind Energy Company” and moved to Minneapolis to develop the business.

Had it not been for the REA, who knows where distributed renewable energy generation and the Jacobs Wind Energy Co. would be today? The Jacobs business model relied on rural farms that private utilities refused to serve, claiming they were unprofitable. When the REA provided tremendous subsides to electric cooperatives to serve rural areas, the Jacobs business model dried up. By 1952 almost all U.S. farms had electricity thanks to the REA, and by the late 1950s The Jacobs Wind Energy Co. filed for bankruptcy, having sold an estimated 50,000 wind turbines.

The Jacobses were clearly ahead of their time, but their idea was fundamentally sound. Wind passing over the landscape can provide us with many times the energy we need, if we can harness it cost-effectively.

The last 30 years have seen the realization of Marcellus Jacobs’ dream, with the cost of wind energy from modern turbines coming down by 90 percent since 1980. Prices have dropped so far, in fact, that today wind can out-compete fossil-fuel generation in many instances — especially when utilities seek long-term power contracts that the volatile fossil-fuel industry can’t sign without charging a heavy premium for what natural gas or coal might cost decades from now.

But the wind industry’s success is in part due to the wind energy production tax credit (PTC), a 2.2-cents-per-kilowatt-hour performance incentive that has driven innovation and operating experience in the still-emerging technology. Unfortunately, the PTC is set to expire this year unless Congress acts, possibly cutting out the legs under an industry that is beginning to realize its potential.

At home, abandoning the tax credit could prove disastrous. Modern wind energy operations didn’t get going in Montana until 2005, when the 135-megawatt Judith Gap project became our first wind farm. Since then, Montana has added nearly 500 megawatts of wind energy, 229 this year alone. There are many hundreds more megawatts of wind energy under development in the state, but developers will require tax certainty for companies to invest. Until then, billions of investment dollars and hundreds of jobs will be sidelined.

Thankfully, we Montanans seem to understand the value of affordable, home-grown, pollution-free energy. A recent bipartisan poll shows that 86 percent of Montana voters support the development of wind energy and 55 percent name it first when asked which sources they most want to encourage.

Our political leaders agree. In rare bipartisan unanimity, Sen. Baucus, Sen. Tester and Rep. Rehberg all support an extension of the tax credit for wind energy. And in a turn that took many Congress watchers by surprise, Sen. Baucus guided a bill out of his committee, and out of the gridlock gripping Washington, with large bipartisan support that includes a PTC extension. With his leadership, the bill is expected to pass the Senate when Congress returns from recess. Before an extension of the PTC can become law, it will also need to pass the House.

Franklin Delano Roosevelt had a bold vision for electricity on every family farm, and his vision paid off handsomely. Today, we need a new vision, one that envisions clean, limitless, affordable renewable energy and an electricity grid that can accommodate it. The PTC is part of achieving that vision.

With any luck, we Montanans can bring a little common sense to Washington and pass this clean energy driver for the nation. And if anyone asks why we care so much for wind energy, we can say because we invented it.

Call Sen. Baucus today and thank him for his leadership, like Montanans before him, in moving wind energy forward.

Jeff L. Fox is the Montana policy manger for Renewable Northwest Project, a nonprofit regional advocacy group that promotes the expansion of environmentally responsible renewable energy resources.

The Chicago Sun-Times has joined the list of major newspapers across the U.S. calling for an extension of the federal wind energy Production Tax Credit (PTC).

In a recent editorial, the Sun-Times referred to the Romney campaign’s support for ending the credit as an “empty bumper sticker proposal” that risks losing the Presidential election swing state of Iowa. 

It added: “Government sometimes plays a legitimate role in nurturing emerging industries … Throughout American history, great industries and new technologies, such as the automobile, have thrived on sympathetic government support, including tax breaks and infrastructure investments. If we are to wean the nation off its dependence on fossil fuels, government must continue to support the development of other sources of energy.

“Plenty of government programs are boondoggles … But not all.”

The San Antonio Express-News today endorsed an extension of the federal wind energy Production Tax Credit (PTC).

Said the Express-News editorial in part:

"The Obama administration wants to extend the incentives, and the issue has become an election-year football. But Congress should act prior to the November election.  The administration reported that the wind power industry supports 75,000 American jobs, and the report showed that 67 percent of new wind turbine equipment used last year was domestically produced. Only 35 percent of the equipment was made domestically in 2006. The federal report cited $14 billion in wind energy investments last year …

"The industry has done particularly well in Texas. The Houston Chronicle noted that growth slowed in the state last year, but Texas remains the top producing state. The federal report found that Texas can generate 7.3 percent of its electricity with wind … The investment in wind power is smart long-term policy because it provides clean energy and diversifying generation helps utilities mitigate the problems created by excessive reliance on one or two sources."

With its endorsement, the newspaper joins a long and growing list of publications nationwide that have formally announced their support for continuing the PTC.  In just the past two weeks, the Des Moines (Iowa) Register, the Dubuque (Iowa) Telegraph Herald, the Gazette (Cedar Rapids, Iowa), and the Bakersfield Californian have all urged Congress to extend the provision.

The Dubuque (Iowa) Telegraph Herald endorsed the federal wind energy Production Tax Credit (PTC), joining many other newspapers from coast to coast–and more to the point, others in the Presidential election swing states of Iowa and Colorado–that have said they favor extending the provision.  In recent days, the Des Moines Register and the Gazette (Cedar Rapids, Iowa) have also backed the PTC.

In its editorial, the Telegraph Herald responded crisply to some of the arguments that are made against the PTC. On the question of the incentive giving wind an advantage over other energy sources, the editorial commented, “Over coal? Over natural gas? These industries have the infrastructure built over a century of being consumers’ only option.”  The PTC, it added, helps wind gain a foothold against its established, entrenched competition.

In addition, the Telegraph Herald said, all energy sources are not created equal: “In fact, there are disadvantages to coal that don’t exist with wind. Coal-burning plants emit mercury, sulfur dioxide, nitrogen oxide and particulate pollution, all of which can have a negative impact on the environment … Creating wind energy, meanwhile, is getting cheaper, dropping more than 90 percent since the early 1980s. Technological advances are dramatically changing the industry: A typical wind turbine generates 30 percent more electricity today than it did just a few years ago … Now is the time to cultivate wind energy generation … It’s about jobs. It’s about energy costs. It’s about sustainability. Don’t end the wind energy tax credit too soon.”

The Gazette, a newspaper based in Cedar Rapids, Iowa, has joined the long list of papers endorsing an extension of the federal wind energy Production Tax Credit (PTC).

In an editorial Sunday titled "Romney should revisit wind tax issue," the Gazette noted Iowa Gov. Terry Branstad's (R) disagreement with the Republican Presidential candidate on the question. Said the editorial in part, "We agree with the governor. The tax credit has helped our state become the nation’s No. 2 producer of wind energy–providing 20 percent of our electric power. The industry includes several plants that produce wind turbines or components. Nearly 3,000 turbines spin statewide. And the industry provides more than 6,000 good jobs for Iowans, according to the Iowa Wind Energy Association. Landowners who lease land for the turbines receive more than $14 million a year …

"It’s just too soon to pull the tax credit for wind power. Give the industry more time to prove itself."

 

Following last week’s favorable vote by the Senate Finance Committee on draft legislation including an extension of the federal wind energy Production Tax Credit (PTC), Sen. Chuck Grassley (R-Iowa) released a statement regarding his support for the extension, calling the PTC “successful in developing clean, renewable, domestically produced wind energy and the jobs that go along with it.”

Grassley added, “In the face of an effort to end this incentive, I persuaded committee leaders to include the extension in a way that keeps it at full value and that puts the wind-energy production tax credit in a strong position for the floor debate this fall.  No single energy tax incentive should be singled out over others, energy-related and not, before a broad-based tax reform debate.”

The full text of the statement follows:

For Immediate Release
August 2, 2012

Support for the wind-energy production tax credit

M E M O R A N D U M

TO:    Reporters and Editors
RE:    Support for the wind-energy production tax credit
DA:    Thursday, August 2, 2012

Senator Chuck Grassley issued the following comment about the inclusion today of a one-year extension of the wind-energy tax credit in The Family and Business Tax Cut Certainty Act of 2012 reported by the Committee on Finance.  The overall package includes an amendment written by Senator Grassley and accepted this morning as part of the modified proposal of Committee Chairman Max Baucus.

Grassley comment:

“The wind-energy production tax credit is designed to level the playing field for this renewable resource against coal-fired and nuclear electricity generation.  The credit has been successful in developing clean, renewable, domestically produced wind energy and the jobs that go along with it.  The one-year extension approved today would make the credit effective for producers for one more year.  In the face of an effort to end this incentive, I persuaded committee leaders to include the extension in a way that keeps it at full value and that puts the wind-energy production tax credit in a strong position for the floor debate this fall.  No single energy tax incentive should be singled out over others, energy-related and not, before a broad-based tax reform debate.  Congress and the President need to take up tax reform to make American business more competitive with lower rates, a broader tax base, and a simpler code.  Until tax reform is undertaken, workers and employers need certainty in existing tax law.”

Description of the Grassley amendment to The Family and Business Tax Cut Certainty Act of 2012:

Extend for one year, through December 31, 2013, the section 45 production tax credit for wind which expires on December 31, 2012.  Modify placed-in-service date for wind to a “begin construction” rule.

Background information:

Senator Grassley authored the legislation that created the wind-energy production tax credit in 1992 and has won passage of extensions a number of times.

Today, wind-energy production supports 75,000 American jobs and drives as much as $20 billion in private investment.  During the last five years, 35 percent of all new electric generation in the United States was wind.  There are nearly 400 wind-related manufacturing facilities in the United States today, compared with just 30 in 2004.

Conventional energy sources, including oil, gas and nuclear, enjoy countless tax incentives and many of them are permanent law.