The 2014 State of Wind Energy - Desperately Seeking Subsidies

Wind Energy / Economics

Date posted: 07/13/14

With the growing story coming out of Ukraine, the ongoing search for the missing Malaysian jet, the intensifying Nevada cattle battle, and the new announcement about the additional Keystone pipeline delay, little attention is being paid to the Production Tax Credit (PTC) for wind energy or any of the other 50 lapsed tax breaks the Senate Finance Committee approved earlier this month. But, despite the low news profile, the gears of government continue to grind up taxpayer dollars. The PTC is often the deciding factor in determining whether or not to build a wind farm. According to Bloomberg, wind power advocates fear that without the restoration of the subsidies, worth 23 US dollars per megawatt hour to turbine owners, the industry might not recover, and the U.S. may lose ground in its race to reduce dependence on fossil fuels driving global warming. The abundance of natural gas and subsequent low price has also hurt the wind energy predicted price parity. South Dakota Gov. Dennis Daugaard (R), in Bloomberg, said that if gas prices were not so cheap, then wind might be able to compete on its own. David Crane, chief executive officer of NRG Energy Inc., which builds both gas and renewable power plants, agrees saying that cheap gas has definitely made it harder to compete. With the subsidy, companies were able to propose wind projects below the price of natural gas. So, energy prices do not favor wind energy, not to mention the growing opposition to wind energy due to the slaughter of birds and bats including the protected bald and golden eagles. Growing fears about health impacts, maintenance costs, and abandoned turbines also put further wind-energy development in jeopardy.