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The Importance of Renewing the Production Tax Credit

TurbineSunsetOn the heels of the UN Climate Summit, there has been a great deal of speculation about where and when world leaders will take actual action on climate change—without a lot of concrete answers.

However, one crucial element to wind development in the U.S. that Congress can act on now is the Production Tax Credit, or PTC. The PTC, which expired at the end of 2013, provided new wind farms a tax incentive of $0.023/kilowatt hour (kWh) for the first 10 years of their operation. While 2-cents per kWh may not seem that critical, for farms that are producing large volumes of clean energy, this incentive has meant the difference between getting projects built and not.

The PTC was originally implemented in 1992 and has been repeatedly renewed, a Congressional act that has allowed for the unprecedented growth of American wind. However, without the PTC, wind energy growth is forecasted to slow or even stall once projects that are currently under development are completed. This shift in the market comes at a time when public support for renewable energy is booming, and when citizens around the world are calling for solutions rather than the oil & gas status quo.

Recently, U.S. Reps Earl Blumenauer, of Oregon, and Dave Loebsack, of Iowa, spearheaded new legislation that would extend expired clean energy incentives, including the PTC. The bill, H.R. 5559, the “Bridge to a Clean Energy Future Act of 2014” would extend the PTC and other incentives for a two year period in order to give the existing pipeline a boost.

In his public comments, Loebsack made clear that clean energy is not only the future for our planet, but that the wind power industry alone employs 80,000 Americans. The goal of H.R. 5559 is to provide stability for the next several years to allow explosive growth in both solar and wind (in addition to other renewables) to get anchored.

Loebsack has called for “immediate action” to pass the extension of the PTC and Franz Matzner with the Natural Resources Defense Council (NRDC) has said that, “When Congress returns in November, anyone who cares about saving jobs and cutting pollution should make restoring clean energy incentives priority one.”

North American renewable energy sources like wind, solar, geothermal, and hydropower not only enhance local economies and improve air quality, but are making a considerable impact on the shift away from fossil-based fuels. This has the potential to impact climate change while also keeping domestic energy production here in North America.

Want to take action? Contact your representative to urge them to support H.R. 5559 and keep wind production in the U.S. going strong.

By | 2014-10-17T20:26:00+00:00 October 17th, 2014|Environmental Blog|

About the Author:

Amy brings 20 years’ experience in leadership and organizations to her work in sustainability communications for Renewable Choice. She earned her M.Ed. at Colorado State University.