In 2011, the United States led the world by investing more than $48 billion in clean energy. That news is very welcome in an age when it seems like the Chinese are outperforming the United States in just about every measure of progress. The US has about 50 gigawatts of wind turbines online, enough to power 11 million homes, and about 9 gigawatts is currently under construction, including some Exergy projects.
Nationally, wind provides 3.2 percent of all energy but Iowa gets a whopping 20 percent of its power from wind and Texas, 7 percent. Renewable energy portfolio standards and favorable public opinion bode well for wind, but without the reauthorization of the Production Tax Credit, wind power will have a much harder time. The credit is set to expire at the end of this year without Congressional reauthorization and Congress is currently debating the measure.
Wind energy has produced hundreds of thousands of jobs and assisted farmers and small towns with tax revenue and royalty payments; a typical 250 megawatt wind farm creates more than a thousand jobs in manufacturing, construction, engineering and management. New wind farms can produce energy for 5 to 8 cents per kilowatt-hour, making wind competitive with fossil fuels. Wind energy has a vital role to play in the nation’s energy portfolio and as a leading developer of wind energy, Exergy looks forward to decades more of clean energy and economic development.
But we often hear the wind industry is “subsidized” and “couldn’t stand on its own.” Ironically, many of the same arguments could have been made when the government built various hydro projects, or provides subsidies for oil and gas exploration and development. In truth, all forms of energy need targeted governmental support - direct or indirect - to remain reliable, affordable, accessible and consistent. According to the Environmental Law Institute, US energy subsidies for fossil-based industries amounted to $72 billion from 2002-2008 and $29 billion for renewable sources, primarily for biofuels. That’s not counting indirect subsidies for fossil fuels, such as military action to secure access to foreign oil supplies, or health effects from burning coal.
The wind production tax credit doesn’t amount to much, just 2.2 cents per kilowatt hour, yet this alone has helped increase American wind output twentyfold since 2000. President George H.W. Bush signed the PTC into law in 1992 and has been reauthorized seven times since then. Unless Congress reauthorizes it, it will expire at the end of 2012.
Already, failure to reauthorize the PTC is costing jobs. In August, three companies that make components for turbines laid off 219 people, citing uncertainty about the PTC. Unless Congress reauthorizes this proven way to provide clean energy and development, we will likely see more harm come to the wind industry.