Wind Developers Race to Beat Tax Credit Expiration Date
Wind developers are pushing to complete projects in 2012 in advance of the possible expiration the wind production tax credit (PTC), a federal incentive set to expire Dec. 31, according to the US Energy Information Administration.
Under current law, projects that begin operating prior to the end of 2012 are eligible to receive a 2.2-cent PTC for each kWh of generation over a 10-year period.
According to EIA, even as completed wind projects accumulated during 2012 (see chart, dark blue bars), the amount of capacity expected to come on line before the end of the year continued to increase (light blue bars plus dark blue bars). As of Nov. 30, 2012, the wind capacity planned to come on line by the end of December would account for approximately half of the total 2012 wind capacity additions.
If all planned wind generators for 2012 come on line, as reported by industry participants, wind capacity additions could top 12,000 MW for this year. EIA says this would account for 45 percent of total additions and exceed capacity additions from any other fuel source, including natural gas, which was the leading fuel source for electric generating capacity additions in 2010 and 2011.
Many in the wind industry, however, remain hopeful that Congress will extend the PTC. Denise Bode, CEO of the American Wind Energy Association, announced late last week that she is so confident that elected officials will extend the tax credit that she is resigning, 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 production tax credit,” Bode said in a statement. “When that is secured, all of my goals from the AWEA Board will have been accomplished.”
In November, the day after the elections, the AWEA celebrated the reelection of President Obama and most of AWEA’s key champions in Congress.
At the time, Bode said layoffs have affected workers in Iowa and Colorado with at least 4,000 jobs already lost in anticipation of the Dec. 31 expiration date. If Congress doesn’t renew the PTC, Bode said 37,000 more jobs could be lost.
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