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Fact check: Heritage works busily to create new wind myths

Fact check: Heritage works busily to create new wind myths

The Heritage Foundation’s blog recently carried a post concerning so-called wind myths. Unfortunately, as might be expected from a bitterly anti-wind (and, of course, fossil-fuel-funded) group, the result was more myths and falsehoods.

With the Production Tax Credit (PTC) set to expire at the end of the month unless renewed by Congress, it is important to be clear on how the PTC has encouraged wind power development and why the job isn’t done yet.

The following facts illustrate just a few of the reasons why the PTC is still needed.

Fact #1: Wind energy has been one of the fastest developing energy sources in America.

Wind added 35% of all new U.S. electric generating capacity between 2007 and 2010, neck and neck with natural gas as one of the top two new electricity sources.

In August, the U.S. wind industry hit 50,000 MW of cumulative wind capacity, enough to power the equivalent of 13 million homes. Earlier in the year, the U.S. industry passed another milestone, having generated as much electricity cumulatively as could be generated by burning 1 billion barrels of oil–without using any fuel.  Additionally, wind power attracts over $15 billion in private investment in the U.S. per year and supports 75,000 jobs in the United States.

However, a PTC extension is crucial to avoid disruption in the industry and to enable it to achieve the cost reductions needed to be fully competitive in the electricity market.

If the PTC is allowed to expire, wind power be singled out as the only energy source to lose its federal tax credit this year. Current estimates show that half–37,000–of wind-related jobs would be lost.

For more on this, visit http://www.awea.org/learnabout/publications/upload/AmericanWindpowerBrochure.pdf.

Fact #2: The federal Production Tax Credit (PTC) is an effective tool to encourage development of a proven renewable energy source.

Equipped with the PTC, the wind industry has been able to lower the cost of wind power by more than 90%, install enough capacity to power the equivalent of 13 million American homes, and foster economic development in all 50 states.

The PTC for wind is tax relief–not a subsidy.  It only rewards results, and it doesn’t cost taxpayers a dime. The tax credit simply leaves more money in private hands–in this case, the hands of those who invest in producing renewable energy.

While incentives for other energy industries have been permanent fixtures of the tax code for five or more decades, the tax relief for wind power has always been extended on a short-term, one- or two-year basis–an approach that hampers wind companies’ ability to plan and invest for the future.

The bottom line: the PTC allows the certainty for wind energy to compete and grow in the U.S.

For more on this, visit http://www.awea.org/issues/federal_policy/upload/PTC-Fact-Sheet.pdf.

Fact #3: Wind power drives economic investment across the country.

Again, the Production Tax Credit isn’t a subsidy, but tax relief. Federal tax incentives similar to the PTC have helped all of our domestic energy industries to grow and produce the energy that our economy needs to function and prosper.

For new energy technologies to gain a foothold in the marketplace so that the U.S. can diversify its energy portfolio and reduce its vulnerability to fuel price shocks, some degree of initial support is needed.

As one particularly informative study on historical energy incentives by DBL investors states: “Current renewable energy subsidies do not constitute an over-subsidized outlier when compared to the historical norm for emerging sources of energy. For example: … the federal commitment to [oil and gas] was five times greater than the federal commitment to renewables during the first 15 years of each [incentive’s] life, and it was more than 10 times greater for nuclear."

Due to effective tax policy in the form of the production tax credit (PTC), wind energy creates thousands of jobs in the United States and economic boom times for rural communities all around the country. However, wind power manufacturing, construction and other related jobs are currently at risk nationwide due to the uncertainty surrounding the PTC.

If the PTC is extended, employment in the wind industry is predicted to grow to 100,000 American wind jobs over the next four years, with the industry attracting $15-20 billion a year in private investment.

For more on this, visit http://www.awea.org/learnabout/publications/factsheets/upload/Rural-Development_AWEAFactsheet_11-2011.pdf.

Fact #4: We need to continue encourage American wind power development with a smart energy policy.

Countries around the world are dealing with having to manage increased demand for electricity. There’s no one answer to this growing need. Wind power allows for many countries to tap into an abundant energy source today, but governments recognize that smart, stable federal incentives are required to encourage development of relatively new energy sources.

Large amounts of wind energy are already being reliably and cost effectively integrated with the utility system in the U.S.  In 2010, the Texas utility system obtained 7.8% of its electricity from wind energy, with wind energy providing more than 25% of the system’s electricity at one point. Roughly 20% of the electricity produced in Iowa now comes from wind energy.

And wind works globally too. European countries like Germany, Spain, Portugal, Denmark, and Ireland now obtain more than 10% of their electricity from wind energy, with wind providing more than 45% of Spain’s electricity at one point.

This production results from smart energy policy that encourages the development of a diversified portfolio of energy sources. If the Production Tax Credit for wind power isn’t renewed, wind will be the only form of energy generation without a Federal tax credit or cost recovery option.

To learn more, visit http://www.awea.org/learnabout/publications/upload/AmericanWindpowerBrochure.pdf.

Fact #5: The United States boasts the perfect combination of massive electricity demand and a wind resource that is one of the best in the world.

The wind power potential to be tapped is nothing short of amazing: 37 trillion kilowatt-hours of electricity annually – equivalent to nearly 10 times the country’s power needs—in onshore wind resources alone, and still more in offshore waters.

With this clean, domestic, and abundant energy source that keeps our air clean, uses virtually no water resources, and powers one of the fastest growing U.S. manufacturing industries today – we’ll never have to worry about running out of energy.

Learn more about the future of wind and the 20% of wind energy by 2030 goal here: http://www.awea.org/learnabout/publications/upload/20percent_Wind_factsheet.pdf.

Fact # 6: An all-of-the-above energy plan is needed.

Extending the PTC is necessary for a serious “all-of-the-above” energy plan to ensure a diverse mix of energy sources to protect our national security and our economy.

Incentives for fossil fuels and nuclear power have been in place for decades. This heavy government support over the past century brought about the abundance of fossil fuels which now dominate the U.S. power mix.  At the same time, it created an unbalanced energy portfolio which is too dependent on too few energy sources. Today’s energy issues of volatile pricing, water consumption and drought are creating a need for a more diverse energy supply.

There’s a reason why so many utilities from across the country are purchasing wind energy. Wind is frequently the cheapest form of new electric generation – beating out new coal, nuclear and sometimes natural gas power plants.

For example, recently the Alabama Public Service Commission permitted Alabama Power to purchase up to 404 megawatts of wind energy from a wind farm in Oklahoma and Kansas. Alabama Power cited portfolio diversification and environmental benefits as well as low cost as reasons to buy wind energy.

To learn more, visit http://www.awea.org/learnabout/publications/upload/AmericanWindpowerBrochure.pdf.

Fact # 7: Wind power is already reducing the effect of global climate change.

As the nation’s attention focuses more on global warming, the importance of wind energy as a readily available solution becomes clearer. Wind energy can help the U.S. reduce and stabilize carbon dioxide emissions due to electricity production.

Electricity generation is the largest industrial source of greenhouse gases in the U.S. and demand for electricity continues to grow. The United States produces six billion metric tons of carbon dioxide annually and this number could reach 6.75 billion metric tons by 2030.

Wind power generates no emissions, and displaces carbon dioxide and other greenhouse gases that would otherwise be emitted by fossil fuel-fired electric generation.

Wind power is one of only a few near-term options available to reduce emissions on a large scale. In fact, in a May 2008 study, the U.S. Department of Energy concluded that “Wind energy…can be widely deployed across the United States and around the world to begin reducing greenhouse gas emissions now.”

For more on this, visit http://www.awea.org/learnabout/publications/upload/Climate_Change.pdf.

Related articles:

Lesser misstates facts at Heritage-Exelon anti-wind briefing, November 30, 2012
Fact check: Heritage's Loris misguided on wind incentive, August 20, 2012
Fact check: Heritage's Kreutzer errs on cost of wind power, May 29, 2012
Fact check: Heritage, AEI off base on wind incentives, growth, March 8, 2012
Fact check: Heritage off base with assault on PTC, February 28, 2012
Fact check: Heritage errs in supporting job-killing tax hike, December 19, 2011
Fact check: Loris stumbles on subsidies, December 13, 2011
 

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David Ward is the primary point of contact for all press inquiries and manage AWEA’s day-to-day media relations. He also oversees media monitoring responsibilities and analyzes trends in the news about wind power. He owns a Master of Arts in Strategic Communications from Villanova University and earned a Commendation for Service from U.S. Senate Majority Leader Harry Reid due to work for the Democratic Policy and Communications Committee (DPCC).

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