The following responds to an opinion article in today's edition of the Daily Caller from Michael Needham, CEO of Heritage Action for America, on energy subsidies.
Mr. Needham seems to not realize that federal incentives for the wind power industry are an investment in American manufacturing jobs and one of the fastest-growing U.S. manufacturing sectors. Over the last six years, U.S. domestic production of wind turbine components has grown 12-fold to more than 400 facilities in 43 states, shifting manufacturing jobs from overseas back to the U.S.
Wind power is not only a manufacturing industry that America can compete in, it’s a market that we are winning, with the help of the production tax credit (PTC). The PTC is set to expire at the end of 2012, and it is crucial that it be extended.
Overall, wind power supports 75,000 jobs across the U.S. today and — with stable tax policy — it promises to support 500,000 American jobs less than twenty years from now, according to a Department of Energy study completed during the Bush Administration. Allowing this vital tax incentive to die would in effect be raising taxes on companies creating these American jobs and would be a mistake that would cost our economy exactly the sort of manufacturing jobs we need more of today. It is surprising that at this time when our economy is struggling, Heritage Action for America would support a tax increase on an emerging industry that is creating jobs.
The PTC has been supported on a bipartisan basis in the past, and continues to receive support from both sides of the aisle today. With the threat of the PTC’s expiration, wind project developers are not making plans in the U.S. and American manufacturers are not receiving orders. Job layoffs have started already. The wind industry is facing the recurrence of the boom-bust cycle it has seen in previous years when the PTC was allowed to expire. In the years following expiration, installations dropped between 73% and 93%, with corresponding job losses.
Historically, at least six to eight months before the tax credit expires, financial lenders hesitate in providing capital for projects because of the uncertainty created by the pending expiration of the credit, stalling projects from coming online. The rush to complete projects as the credit nears expiration also reduces projects and adds costs, resulting in higher electricity prices.
As families across our country struggle with unemployment, and as businesses are cutting back just to survive, it’s past time for the U.S. Congress to focus its ideas and efforts on proposals that will create jobs and get our economy moving again. Extending this key tax incentive for wind and other forms of renewable energy generation is one of the best ways to spur economic development and create the good jobs we need.
A vote for a PTC extension is a vote for growing clean, homegrown, affordable energy resources and badly needed new American manufacturing jobs.
Forecast for wind: Storm clouds ahead without stable tax policy, October 31, 2011
KCAU-TV gets message: Iowa wind needs PTC, October 25, 2011
Consistent policy is key to competing with other countries, October 24, 2011
Wind farms make 1st appearance in Ohio, 'churning up cash', October 17, 2011
Don't increase taxes on clean energy, September 26, 2011
Wanted: Predictable energy policy, July 29, 2011
Flurry of positive news, but expiration of key incentive looms, July 15, 2011