The PTC Is No Longer Needed To Support The Wind Industry

Wind Energy / Economics

Date posted: 10/24/14

Anthony J. Alexander, Christopher M. Crane and Thad Hill indicate that last year the U.S. Congress allowed the production tax credit -PTC- for wind power to expire after more than 20 years and numerous extensions. Now some people in the wind industry want it resurrected, but it is clear that an extension is not warranted by any measure. As chief executives at some of the largest coal, natural gas, and nuclear companies, the authors indicate that they have a deep and abiding commitment to clean and reliable energy, with substantial interests in renewable energy resources, including wind, solar, geothermal and hydropower. They believe the PTC has achieved its original purpose, namely shepherding a nascent industry to maturity, and any extension will cost taxpayers and electric consumers billions simply to benefit a handful of vested interests. While a tax extenders bill pending in the U.S. Senate would reinstate the PTC at a projected cost to taxpayers of 13 billion US dollars, it is clear that this tax credit is no longer needed to support the wind industry. Wind power has become a multi-billion dollar business comprised of sophisticated companies and investors from around the globe. Today there is over 60,000 megawatts -MW- of wind capacity in the U.S. with an additional 12,000 MW under construction. In recent years, wind has been the largest source of new electric generation, with a greater share of new capacity than natural gas fired generation. A recent U.S. Department of Energy report found the price of wind turbines has dropped 20 to 40 percent since 2008. In fact, Power Company of Wyoming CEO Bill Miller, who has plans to build the largest onshore wind project in history, recently stated that the PTC is not necessary.