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Wind energy advocates call this week “Wind Week” as they push to get the Production Tax Credit (PTC) for wind energy extended before Congress takes another undeserved vacation before the election. Wind Week shows the urgency with the upcoming expiration of the PTC at year’s end.

Bob Keefe, a spokesman with the Natural Resources Defense Council (NRDC), said in an interview with “The Hill” Monday that there is an eight-day window to get the incentive through the Senate. If the Senate does not act before Congress departs in 8 days, another wave of job losses might occur.

“The idea is that the PTC is gong to expire at the end of the year, Congress doesn’t have a whole lot of time to do something about it and these eight days are going to be crucial,” Keefe said.

The Senate Finance Committee passed a $205 billion tax extenders package before the August recess that included the wind incentive setting up the possibility for a vote. A tax extenders package is usually a non-confrontational bill that extends all tax-related acts that have sunset provisions meaning they expire periodically to allow Congress to review them.

The groups want to get the bill passed in the Senate to signal hope to the wind industry that Congress may act before the credits expire. Senate Majority Leader Harry Reid (D-NV.) has said he is "very confident" the incentive will clear the Senate this year.

Peter Kelley, a spokesman with the American Wind Energy Association (AWEA), said on Monday that his organization does not know whether there would be a Senate vote on the package this week. “I guess with every day it becomes more likely that the whole thing will have to be done in the lame duck,” he said.

The uncertainty over the PTC has already hurt the wind industry. Vestas has already laid off workers in its two Colorado manufacturing plants. Other firms around the country have either laid off workers or announced plans to do so unless the credit is extended. The longer Congress fools around with this, the more damage the industry will suffer. There are 75,000 jobs in the wind energy industry and 37,000 will disappear if the PTC dies.

The November election brings more uncertainty. Wind energy has doubled under the Obama Administration, but Mitt Romney and Paul Ryan are generally opposed to green energy and extending the PTC. The industry may be waiting for the election to get some clarity about what the future of clean energy will be.

Conservative groups are fighting the incentive. Americans for Prosperity, partially funded by the billionaire Koch brothers, and 60 other right-leaning groups opposed the incentive in a letter sent to Congress last week according to “The Hill.” Their opposition is mostly due to the fact they are either engaged in the oil and gas business, or receive funding from oil interests. These same groups advocated keeping the 100-year old $4 billion dollar package of subsidies to oil companies.

The wind incentive is also still wrapped up in a broader, more complicated tax bill. Many lawmakers are holding out for federal tax code reform. There is a fat chance that will get done in this Congress.

The House is less likely to approve the credit than the Senate. The lower chamber has yet seriously debated the issue, making its passage before the election unlikely. The House is controlled by Republicans.

The incentive’s supporters will release reports and boost communication with lawmakers this week with the goal of getting a Senate vote. The NRDC will release two reports on the wind industry Tuesday. The National Wildlife Federation (NWF) will release a report Thursday on Atlantic offshore wind energy. Environment America and other organizations partnered in the report, NWF said.

Also, executives from health, environmental and energy organizations sent a letter to congressional leadership on Monday pushing for an extension to the PTC and offshore wind investment tax credit. Signatories included NRDC, Environmental Defense Club, Blue Green Alliance and Physicians for Social Responsibility, among others.

Despite the good efforts of these groups, they are facing a strong head wind. Perhaps it will take divine intervention to save this vital industry.

Examiner

Wind power is facing a make-or-break moment in Congress, with renewable-energy firms' projects on hold as lawmakers debate whether to extend subsidies for new wind farms this month.

Currently U.S. tax credits are available only for facilities that come online before the end of 2012. Iberdrola Renewables, the second-largest U.S. wind operator, has suspended work on new U.S. projects for "anything we can't build in 2012," said Rich Glick, vice president of government affairs for the unit of Spain's Iberdrola SA.

Industry players see two main chances for Congress to act this year. One comes in February, when the wind subsidies could be tacked on to an extension of payroll-tax cuts. The other would come in the lame-duck session after November elections, when lawmakers must address the expiration of tax cuts from 2001.

The tax credit has helped bring down the cost of wind power, making it more competitive with rival producers, but wind's backers say they need a few more years to build out a U.S. supply chain. The sharp fall in U.S. natural-gas prices has made this a particularly sensitive moment for wind energy by giving gas-fired power plants an extra cost advantage.

Previous delays in extending the wind-farm tax credit have led to drop-off in wind installations. The credit, designed to help level the playing field with coal and other fossil fuels, is worth 2.2 cents per kilowatt-hour of electricity produced during the first 10 years a wind farm is in operation.

A delay could also stunt efforts to bring down the cost of wind-power technology. "We face the loss of domestic expertise and the momentum to build a strong domestic supply base," said Luis Miguel Fernandez, chief corporate officer for the North American arm of Spain's Gamesa Corp., which has a factory in Pennsylvania.

Last month, Vestas Wind Systems said it will cut 1,600 U.S. workers if the tax credit isn't renewed, on top of 2,300 jobs it is already shedding world-wide. An industry-backed study by Navigant Consulting said in December that thousands of additional job cuts could occur if the credit expires.

About 6.8 gigawatts of wind power were installed in the U.S. in 2011, bringing the total nationwide capacity to nearly 47 gigawatts, enough to power about 12 million homes at any given time, according to the American Wind Energy Association. That is about 3% of total U.S. generating capacity.
 
Without the wind tax credit in place, Navigant said, about two additional gigawatts of wind capacity would be installed in 2013, as opposed to more than eight gigawatts expected to be added in 2012, when the tax credit will still be in place.
 
Other predictions are more dire. Iberdrola's Mr. Glick said there would be "close to zero" gigawatts of wind capacity installed next year without an extension soon.

Some in Congress say it is time to end subsidies for renewable energy. The wind industry "simply cannot continue to rely on the American taxpayer," said Rep. Mike Pompeo (R., Kan.), who has a bill that would cut many energy-related credits from the tax code. "Each time it comes up to a year of expiration, they say, 'If we just get a few more years our technology will mature and we will become more competitive.' It's time for them to figure out how to do that."

The industry's supporters argue that Chinese manufacturers also get government support, and they say companies need more time to build a U.S. supply chain and drive down costs.

Denise Bode, president of the American Wind Energy Association, said that in several years' time "we will not need" the tax credit but losing it now could stunt efforts to attract new investment.

Some U.S. facilities may keep going without the credit, thanks to foreign demand and mandates in many states for utilities to buy increasing amounts of renewable power.

Twenty-three governors have backed a bill that would extend the tax credit by four years. Senate Majority Leader Harry Reid (D., Nev.) said late last month the credit is "extremely important" and suggested it should be included with the extension of the payroll-tax break.

Some House Republicans have supported the four-year extension. But Rep. Dave Camp, a Michigan Republican and lead House negotiator on the payroll-tax bill, has said energy tax credits shouldn't be part of the payroll-tax discussions.

Original Article – Wall Street Journal