The following blog is cross-posted from AWEA's Into the Wind blog.
Some 3,000 jobs in North Carolina are threatened by the impending expiration of the federal wind energy Production Tax Credit (PTC) at the end of this year, according to the Southeastern Coastal Wind Coalition.
Because of the lead time involved in ordering turbines and parts for new wind farms, the uncertainty of the credit's status is already impacting companies in the wind power industry.
Coalition president Brian O'Hara says of the situation, "When you have uncertainty in what tax policy is going to be, that prevents developers from making decisions, and when developers can't make decisions then suppliers can't make decisions, and it slows down the whole economy ... A lot of lawmakers don't realize the economic impact that the wind industry has in the Southeast. This region is a great example of a collection of states that has a very attractive environment for manufacturing and benefits from this industry."
The Southeast has garnered a substantial number of new manufacturing jobs over the past several years, which have seen a dramatic increase in the volume of American-made wind turbines and components. Since 2005, domestic content in new turbines has risen from 25 percent to nearly two-thirds, and since the industry has expanded, the rise in dollar value has been even more impressive, from roughly $900 million in 2005 to more than $9 billion last year. Today, nearly 500 factories across the country make turbines and parts, and AWEA's annual report for 2011 found 19 of those factories in the Tarheel State, turning out wind-related products ranging from steel to lubricants and bearings.
The PTC provides an income tax credit of 2.2 cents per kilowatt-hour for the first 10 years of electricity production from utility-scale turbines. It is set to expire on Dec. 31 unless Congress extends it first. A recent study by Navigant Consulting found that extending the Production Tax Credit will allow the industry to grow to 100,000 jobs in just four years, while an expiration would kill 37,000 jobs within a year.
A House bill seeking to extend the PTC has 105 cosponsors, including 24 Republicans, while a similar Senate bill is cosponsored by seven Senators, including three Republicans. PTC extension efforts have received the endorsement of a broad coalition of more than 370 members, including the National Association of Manufacturers, the American Farm Bureau Federation, the Edison Electric Institute, and the Western Governors’ Association. A PTC extension also has the support of the U.S. Chamber of Commerce, the National Governors Association, and the bipartisan Governors’ Wind Energy Coalition, which includes 23 Republican and Democratic Governors from across the U.S. A PTC extension has been endorsed by a number of newspapers across the country, including the Houston Chronicle,The New York Times, the Denver Post, the Daily Oklahoman, and the Toledo Blade.
Further endorsements of the wind energy production tax credit.