Wind Energy Tax Credit Extended for Two Years
Congressional Action Expected to Restore Momentum to Fast-Growing Energy Sector After Year of Record Growth
Washington, DC. The American Wind Energy Association (AWEA) today announced that the wind energy Production Tax Credit (PTC) -- an important factor in financing new wind power installations -- will be extended for two years as part of a slimmed-down economic stimulus and unemployment insurance bill (H.R. 3090) approved by the House (3/7) and Senate (3/8). President Bush has stated that he will sign the bill into law. The PTC provides a 1.5 cent-per-kilowatt-hour tax credit (adjusted annually for inflation) for electricity generated with wind turbines.
The PTC, which had expired December 31, 2001, will be extended retroactively from that date to December 31, 2003. AWEA also continues working for the full five-year extension contained in the wide-ranging energy policy bill (S. 517) now being debated in the Senate. The popular PTC extension was one of 17 expired tax provisions essentially held hostage since last December subject to the much larger political debate over economic policy.
The House approved the package by a whopping vote of 417-3. The Senate approved the same package by a vote of 85-9, with six members not voting.
"The American wind energy industry welcomes Congressional passage of a two-year extension of the wind energy production tax credit,” said AWEA executive director Randall Swisher. “This action by Congress and the expected signature of President Bush means that about $3 billion in wind energy investments forecast over the next several years are now back on track across the country. More importantly, hundreds of furloughed wind industry employees can now go back to work building and installing new high-tech wind turbines. In addition, with the PTC back in place, wind energy development in the U.S. should resume the blistering pace it set last year when more wind capacity was installed than in any previous year in U.S. history. We look forward to continued leadership in Washington as we work together to provide 6% of the nation's electricity from wind by 2020."
The delay in extending the PTC came as the U.S. wind industry wrapped up a banner year, in which it installed more than twice as much new generating capacity, close to 1,700 megawatts (MW), as in any previous year (previous record--732 MW in 1999). In fact, with a strong state law encouraging renewable energy, Texas alone installed more new wind capacity in 2001 (915 MW) than the previous record for the entire U.S.
The extension will allow the domestic wind industry to continue growing and producing new jobs, particularly in Texas, the Great Plains and other regions where wind development has been strongest. New high-tech wind turbines are fueling rural economic development and providing supplementary income for farmers and ranchers leasing small portions of their land to wind developers. Wind leases can provide farmers, ranchers and other landowners with supplementary income of about $3,000 per turbine, per year, for about twenty years.
"Gaining the PTC extension became a reality through the cooperative leadership of Sens. Chuck Grassley (R-IA), Byron Dorgan (D-ND), Harry Reid (D-NV), Kent Conrad (D-ND), Jim Jeffords (I-VT), Max Baucus (D-MT), Gordon Smith (R-OR) and many others,” said Jon Chase, AWEA’s assistant director of legislative affairs. “On the House side, Reps. Bill Thomas (R-CA), Mark Foley (R-FL), Bob Matsui (D-CA), Jerry Weller (R-IL), Karen Thurman (D-FL) and Jim McCrery (R-LA) were all key players in gaining this extension,” Chase added.
"Particular thanks go to the entire team responsible for this victory,” said AWEA legislative director Jaime Steve, “including AWEA member companies and those participating in AWEA’s Legislative Committee headed by Ward Marshall (AEP Energy Services) and Sam Enfield (Atlantic Renewable Energy Corp.). This winning effort has spanned the tenure of two AWEA presidents: current president David Blittersdorf (NRG Systems of Hinesburg, VT) and previous president Dean Gosselin (FPL Energy, Inc. of Juno Beach, FL).
Since beginning the PTC extension effort last year, AWEA and its allies have achieved a number of milestones, including:
Attracting 156 sponsors to the House PTC bill (H.R. 876, by Rep. Mark Foley, R-FL), including 25 members of the tax-writing House Ways and Means Committee.
Gaining 27 sponsors on the Senate PTC bill (S. 530, by Sen. Chuck Grassley, R-IA), including numerous members of the tax-writing Senate Finance Committee.
Gaining support from the Bush Administration through inclusion of a PTC extension proposal in the last two budget proposals and the Bush-Cheney energy plan.
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