Renewable Energy Tax Credits Left out of Payroll Tax Extension

The American Wind Energy Association (AWEA), the Geothermal Energy Association (GEA) and other renewable energy associations are no doubt disappointed with the outcome of the U.S. House and Senate negotiations over the payroll tax cut extension, which is ready to be passed.

Renewable Energy stakeholders had hoped to include a one-year extension of the production tax credit (PTC) for renewable energy in the proposed bill but were unable to make it happen in the end.  AWEA hopes to extend the PTC by February 29th so that construction of wind farms is not delayed.

The tax credit provides developers or wind farm owners with 2.2-cents per kilowatt-hour of renewable energy generated.  It is the only federal subsidy for wind and other renewable energy production and expires at the end of 2012. 

Since projects have long lead times, if the PTC isn’t extended soon, delays and cancelations of planned renewable energy projects are likely to start occurring over the next few months.

Jobs and millions of dollars in development are at risk should the PTC expire.  Last month, wind turbine manufacturer Vestas announced that it was cutting 2,335 employees worldwide and ceasing production at one of its 26 facilities. The company also warned that more cuts could be on the way – indicating that 1600 U.S. jobs might be at risk.  In reaction to that news, AWEA’s CEO Denise Bode said, “[The] Vestas announcement shows the danger to U.S. manufacturing jobs if Congress waits any longer to extend the Production Tax Credit (PTC). The layoffs have begun, and every week that goes by without a PTC extension puts these good American jobs at greater risk.”

She said that wind energy has been the one of the fastest growing sources of jobs for Americans.


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Jennifer Runyon has been studying and reporting about the world's transition to clean energy since 2007. As editor of the world's largest renewable energy publication, Renewable Energy World, she observed, interviewed experts about, and reported on major clean energy milestones including Germany's explosive growth of solar PV, the formation and development of the U.S. onshore wind industry, the U.K. offshore wind boom, China's solar manufacturing dominance, the rise of energy storage, the changing landscape for utilities and grid operators and much, much, more. Today, in addition to managing content on POWERGRID International, she also serves as the conference advisory committee chair for DISTRIBUTECH, a globally recognized conference for the transmission and distribution industry. You can reach her at

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