Project Development, Wind Power

Wind Industry Turns Attention to 2012 for PTC Extension

Last weekend Congress finalized year-end legislative activity without taking action to extend the wind energy Production Tax Credit (PTC). AWEA issued the following statement in response:

“We are disappointed that an extension of wind energy’s key federal tax incentive was not included in this bill,” said AWEA CEO Denise Bode. “The clock is ticking, business decisions are being made and some damage is certain. However, when Congress addresses extenders next year, we are very confident that continuing the wind manufacturing success story will be a prominent objective. Tens of thousands of wind energy manufacturing jobs can still be saved if Congress addresses extenders early in 2012.”

A recently released study found that with stable tax policy the wind industry can grow to nearly 100,000 American jobs in the next four years, including growing the wind manufacturing sector by one third to 46,000 American manufacturing jobs. This will keep the wind sector on track toward supporting the 500,000 jobs by 2030 projected in a report by the U.S. Department of Energy during the George W. Bush administration.

The report completed by Navigant finds that if Congress allows the Production Tax Credit (PTC) for wind to expire, jobs in the wind industry will be cut in half, meaning a loss of 37,000 American jobs and a one third cut to American wind manufacturing jobs, while private investment in the industry would drop by nearly two thirds.

“American manufacturing jobs are coming back, with tens of thousands of new jobs from wind power,” said Denise Bode, CEO of the American Wind Energy Association (AWEA). “But these jobs could vanish if Congress allows the Production Tax Credit to expire, in effect enacting a targeted tax increase, and sending our jobs to foreign countries. Congress must act as early in 2012 as possible to keep this American manufacturing success story going.”

With the support of a stable PTC, wind energy is powering one of America’s fastest growing manufacturing sectors. Over the last six years, U.S. domestic production of wind turbine components has grown 12-fold to more than 400 facilities in 43 states, shifting manufacturing jobs from overseas back to the U.S.

The Navigant study finds that wind energy’s geographically diverse manufacturing base would spread job gains around the country. States that would see significant job and private investment gains from a PTC extension include Colorado, Texas, Iowa, Illinois, Pennsylvania, California, Oregon, North Dakota and Ohio.

But, with a job-killing tax increase on the horizon and the PTC’s future uncertain, businesses are hesitant to plan future U.S. wind projects, American manufacturers have seen a drop in orders, and layoffs have already started.  For the purposes of the American wind industry manufacturing sector, which needs lead time to make its products, the PTC effectively expires at the end of this year.

Bipartisan legislation recently introduced by Representatives Dave Reichert (R, WA-08) and Earl Blumenauer (D, OR-03) seeks to grant a four-year extension to the existing Production Tax Credit (PTC) for wind energy (H.R. 3307, the “American Renewable Energy Production Tax Credit Extension Act”). This legislation has garnered the support of 36 cosponsors including 11 Republicans.

This legislation recently received the endorsement of a broad, coalition of more than 370 members, including the National Association of Manufacturers, the American Farm Bureau Federation, the Edison Electric Institute, the Western Governors’ Association, the United Steelworkers and many members of the environmental community. A four-year PTC extension also has the support of the bipartisan Governors’ Wind Energy Coalition comprised of 23 Republican and Democrat Governors from across the U.S.

Carl Levesque is the communications editor at AWEA. This article first appeared in the AWEA Windletter and was reprinted with permission from the American Wind Energy Association.