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New graphics reveal impact of impending PTC expiration on wind industry

New graphics reveal impact of impending PTC expiration on wind industry

A pair of new graphics from AWEA provide a closer look at (1) how the impending expiration of the federal wind energy Production Tax Credit (PTC) disrupts the industry well before the actual expiration date, causing layoffs at wind development companies and component suppliers that gradually spread throughout the industry; and (2) the timetable, after an extension of the credit, until new wind projects go in the ground–illustrating why one-year extensions don't help nearly as much as long-term, predictable policy would.

The first graphic, showing projected job losses, illustrates how, because of the lead time involved in manufacturing, turbines previously ordered will continue to arrive at wind farms and be installed this year, even as layoffs are occurring in the industry's supply chain. While the industry is expected to have a strong year as measured in new installations, the reality will be that employment is steadily declining, at a time when the U.S. economic recovery remains fragile.

The second chart, showing what happens after a PTC extension, basically indicates that new wind farms supported by the PTC, will be going online and producing electricity 18 months later, due to the lead time required to develop projects, secure financing, and manufacture equipment.

Taken together, the graphics should serve as a valuable education tool to quickly convey to members of Congress, media, and others how the industry works and the time constraints under which it operates with respect to a key incentive like the PTC that strongly affects its financing.

The PTC provides an income tax credit of 2.2 cents per kilowatt-hour for the first 10 years of electricity production from utility-scale turbines. It is set to expire on Dec. 31.

A House bill seeking to extend the PTC has 90 cosponsors, including 20 Republicans, while a Senate bill to extend it was introduced March 15 by seven Senators, including three Republicans.  PTC extension efforts have received the endorsement of a broad coalition of more than 370 members, including the National Association of Manufacturers, the American Farm Bureau Federation, the Edison Electric Institute, and the Western Governors’ Association. A PTC extension also has the support of the U.S. Chamber of Commerce, the National Governors Association, and the bipartisan Governors’ Wind Energy Coalition, which includes 23 Republican and Democratic Governors from across the U.S.  A PTC extension has been endorsed by a number of newspapers across the country, including the Houston Chronicle, The New York Times, the Denver Post, and the Daily Oklahoman.

Further endorsements of the wind energy production tax credit.

Related articles:

'Think globally, act locally': News items underscore PTC and manufacturing jobs, April 19, 2012

Senator Levin visits Michigan wind component maker, urges PTC extension, April 18, 2012
Wind power drives strong interest in U.S. renewable electricity generation, April 17, 2012
WindTV: WINDPOWER in Atlanta, spotlighting PTC expiration risk to manufacturing growth
, April 16, 2012

AWEA Annual Market Report underscores need for PTC extension, April 13, 2012

Iowa city prospers, hopes for PTC extension, April 12, 2012

Denver Post editorial writer: PTC extension 'important to nation, Colorado,' April 11, 2012

From Nevada, Michigan, Montana: Calls for PTC extension, April 10, 2012

Sierra Club, BP agree: Extend the PTC, April 9, 2012

South Dakota newspaper joins others in endorsing PTC, April 6, 2012

National Governors Association: Extend the PTC, April 6, 2012

Sen. Bennet tours factories, pushing jobs and PTC extension, April 5, 2012

WindTV Holiday Special: Church lives mission with wind power, April 4, 2012

Montana county commissioners call for PTC extension, April 3, 2012

'Father of PTC' explains wind incentive's value, March 30, 2012

Citing 'all of above,' former FERC chair urges PTC extension, March 29, 2012

Manufacturers tell Senate panel: PTC extension urgently needed, March 28, 2012

WindTV: Colorado county gets big boost from wind power, March 26, 2012

Former Congressman Boucher sees PTC extension likely, March 26, 2012

WindTV: Wind power breathes new life into small Colorado town, March 21, 2012

Citing need for certainty, BP's Landis calls for PTC extension, March 20, 2012

In op-ed, Kansas Governor, Senator call for PTC extension, March 19, 2012

Bipartisan group of Senators introduces bill to extend PTC, March 16, 2012

Houston Chronicle editorial supports PTC extension, March 15, 2012

Southern Alliance head urges: Extend the PTC, March 14, 2012

WindTV: Missouri manufacturer grows with the wind, March 12, 2012

Oklahoma and America need wind technicians–and a PTC extension, March 8, 2012

WindTV: An American family, powered by a paycheck from wind, March 5, 2012

Salazar, citing 'race we cannot cede', backs extending PTC, March 1, 2012

Kerry, Brown win praise for bipartisan support of PTC extension, February 29, 2012

Wichita Eagle editorial blog endorses PTC extension, February 28, 2012

Daily Oklahoman: PTC extension “makes sense,” February 27, 2012

Bipartisan group of Illinois Representatives supports PTC extension, February 24, 2012

Kansas City Star backs PTC extension, praises Brownback, Moran, February 23, 2012

Bennet visits composites factory, urges PTC extension, February 23, 2012

Moran visits Siemens factory, pushes PTC extension, February 22, 2012

WindTV: PTC key to wind power manufacturing jobs, February 21, 2012

Topeka Capital-Journal: Extend the PTC, February 21, 2012

U.S. Rep. Steve King (R-IA): PTC is jobs engine conservatives should support, February 17, 2012

Bennet, Moran continue bipartisan push to extend PTC, February 16, 2012

Major U.S. consumer brands like Nike on extending the PTC: Just Do It!, February 15, 2012

Oklahoma Gov. Fallin urges conferees: Extend the PTC, February 15, 2012

Michigan worker's plea: Extend PTC, help wind power create U.S. jobs, February 13, 2012

Bipartisan letter from entire Iowa Congressional delegation urges: Extend the PTC, February 10, 2012

Senate Energy Chairman Bingaman: Act now to save clean-energy jobs, February 9, 2012

Bipartisan letter from Colorado Congressional delegation urges: Extend the PTC, February 8, 2012

Republican governors push for PTC extension; Senators express support, February 2, 2012

U.S. Chamber of Commerce joins broad range of groups endorsing PTC extension, February 1, 2012

WindTV: Wind power drives commerce in small-town America, January 24, 2012

Denver Post endorses PTC extension 'sooner rather than later', January 18, 2012

WSJ op-ed: 'Want Growth? Try Stable Tax Policy', January 5, 2012

Red State Energy, Red State Jobs, November 29, 2011

 

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