A long-sought extension of the wind energy tax credits are included in the “fiscal cliff” bill signed today by President Obama. Unlike past extensions, it allows the credit to cover wind farms that begin construction—not just those that begin operations—in 2013.
The “down-to-the-wire” approval of the final fiscal cliff package and extension of the wind energy Production Tax Credit (PTC) and Investment Tax was hailed by the wind sector.
The sector’s top lobby, the American Wind Energy Association (AWEA) has said uncertainty over whether the measure would pass over the past year had halted development of new wind projects in the U.S. “America’s wind energy workers have been living under threat of the PTC’s expiration for over a year and layoffs had already begun, as companies idled factories because of a lack of orders for 2013. Uncertain federal policies have caused a ‘boom-bust’ cycle in U.S. wind energy development for over a decade,” it said.
Leaders of the Senate Finance Committee included the PTC extension in a "tax extenders" package they assembled in August, which made it into the overall fiscal cliff deal that passed the Senate early on Jan 1 and the House later that night. In the closing days of this year’s "lame duck" session of Congress, AWEA’s 2,000 member companies sent delegations to Capitol Hill repeatedly, invited members of Congress on tours of wind farms and factories, and delivered hundreds of thousands of letters from constituents, the group said.
The PTC is essentially a tax credit of 2.2 cents/kWh that is applicable to power generated from wind farms for the first 10 years from the start of operations. In a bid for immediate extension of the PTC, AWEA had asked congressional lawmakers to consider a future phase-out of its primary federal incentive. The group said that even if temporary, an extension of the performance-based market mechanism was critical "to allow the industry to invest in the cost-saving technologies required to finish the job."
Meanwhile, AWEA CEO Denise Bode announced she would resign effective Jan. 1, 2013, to return to private practice as a tax attorney. "There is now a strong, bipartisan team of Congressional champions for the wind industry, and the all-important extension of the [PTC]," Bode said. "When that is secured, all of my goals from the AWEA Board will have been accomplished."
Bode will be replaced by AWEA Senior Vice President for Public Policy Rob Gramlich, who will serve as interim CEO through the transition period.
Sources: POWERnews, AWEA