Wind Energy Tax Credit Ends in United States

Partisan differences between political parties in the United States means that the wind energy production tax credit expired on December 31 without being extended.

WASHINGTON, DC, US, 2002-01-11 [] Congress adjourned without agreeing to an economic stimulus bill containing tax credit extensions, or even passage of a routine one-year extension of expiring tax provisions. The PTC, which provided a 1.5 cent per kWh credit (adjusted annually for inflation and now 1.7¢/kWh) is an important factor in financing new wind power installations. A two-year extension had been included in the ‘economic stimulus’ bill that Congress debated for past months. Despite agreement on nearly every major issue, the American Wind Energy Association says negotiations on that legislation failed due to partisan differences over how to deliver health care services to unemployed workers. A last-ditch effort to extend the wind PTC and all 17 expiring tax credits, by attaching them to another bill, also failed. “Extending the PTC would have allowed the U.S. wind energy industry to continue expanding, producing new high-tech jobs, boosting rural economic development and helping achieve cleaner air,” says AWEA executive director Randall Swisher. “The inability of Congress to extend expiring tax credits means this economic development will be delayed a number of months into next year.” Key members of both the Senate and the House have indicated they plan to act on a tax extension bill in 2002. In the past, such bills have contained retroactive treatment for credits that have expired. Congress officially returns January 23, but is not expected to complete action on tax legislation until the spring. In the interim, AWEA will seek a letter from the Republican and Democratic leaders of both tax committees, indicating their intent to extend the PTC as expeditiously as possible. “Despite the inability of Congress to extend the PTC this year, we are very gratified by the strong bipartisan support expressed for wind energy in both houses of Congress and from the Bush Administration,” says Jaime Steve of AWEA. “Sen. Chuck Grassley and Rep. Mark Foley, both of whom sponsored legislation calling for a five-year extension, provided strong leadership over the last two years.” Key politicians include House Ways & Means Committee chair Bill Thomas of California, Senate Finance Committee chair Max Baucus of Montana, and Senators Tom Daschle, Jim Jeffords, Harry Reid, Frank Murkowski, Jeff Bingaman, Mike Crapo, Byron Dorgan, Kent Conrad, Gordon Smith and Jay Rockefeller. Extension of the PTC was included in both the Administration’s fiscal 2002 budget proposal and its energy policy plan. “Within the Bush Administration, David Garman (assistant secretary for renewable energy) was a vigorous advocate for extending the tax credit,” adds Steve.
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