New York Times 9/6/11 – Wind Industry Lobbies for Tax-Credit Extension
The production tax credit program allows owners of wind projects that sell renewable energy to a utility to take a tax credit of 2.2 cents per kilowatt-hour for the first 10 years of a project’s operation. That program is set to expire at the end of 2012, and uncertainty over whether it will be renewed has already affected the industry.
The last time the credit lapsed, at the end of 2003, development of new wind projects tapered off significantly. The credit was ultimately renewed toward the end of 2004, but only 389 megawatts of new wind capacity came on line that year, compared with 1,687 megawatts in 2003.
Because tax credits reduce federal revenues, a sensitive topic in this political season, renewal of the production tax credit is far from certain, according to John Farrell, a researcher with the Institute for Local Self-Reliance, an advocacy group for community-based energy solutions. “Right now I’d say it has even odds for extension,” Mr. Farrell said in an e-mail. Working in its favor is the potential for job creation, he said. [emphasis added]
The article also discusses feed-in tariffs and how they are the dominant renewable energy policy in the rest of the developed world.