Congress extends tax credit for sustainable wind energy in 2013

After a long campaign by wind energy stakeholders, Congress has included the extension of wind energy tax credits in final passage of a bill to avert the "fiscal cliff" that now moves to President Obama for his expected signature. Half of the American jobs in wind energy, or 37,000 out of 75,000, and hundreds of U.S. factories in the supply chain, would have been at stake had the Production Tax Credit (PTC) been allowed to expire, according to a study by Navigant Consulting.

The news was welcomed by the wind energy sector as the continuation of policies are expected to save jobs as well as revive business at nearly 500 manufacturing facilities across the country.

The American Wind Energy Association said the extension of the PTC and Investment Tax Credits for community and offshore projects will keep the momentum for the industry, which installed the most new electrical generating capacity in America during 2012, with factories or wind farms in all 50 states. Wind set a new record in 2012 by installing 44 percent of all new electrical generating capacity in America, according to the Energy Information Administration, leading the electric sector compared with 30 percent for natural gas, and lesser amounts for coal and other sources.

The version included in the deal covers all wind projects that start construction in 2013. Companies that manufacture wind turbines and install them sought that definition to allow for the 18-24 months it takes to develop a new wind farm.

Leaders of the Senate Finance Committee included that version in a "tax extenders" package they assembled in August, which made it into the overall fiscal cliff deal that passed the Senate on January 1st and the House on the evening of that same day. The bill is expected to be swiftly signed into law by President Obama, who is a supporter of wind energy tax credits.

But it's not all good news. The threat of the PTC's expiration which haunted the industry throughout the past year has led to layoffs, 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.

"On behalf of all the people working in wind energy manufacturing facilities, their families, and all the communities that benefit, we thank President Obama and all the Members of the House and Senate who had the foresight to extend this successful policy, so wind projects can continue to be developed in 2013 and 2014," said Denise Bode, former CEO of AWEA, who was replaced by Rob Gramlich on January 02 as interim CEO.

Image credit: AWEA