Originally published in the National Journal's Energy Experts Blog
By Vice Admiral Dennis McGinn
President of the American Council On Renewable Energy
It is important to address our country’s fiscal issues by promoting economic productivity in the short term while reducing the deficit over the long term as I mentioned in my last week’s Energy Experts blog post. It’s fundamental to an overall healthy economy to extend key tax credits that create American jobs and generate private investment, and the PTC is one of the important tax credit programs.
In the past four years, the wind industry, which has benefited from the Production Tax Credit (PTC), has witnessed an annual average growth rate of 35%. Since 1980, the price of wind power in America has dropped 90%, directly benefiting American consumers and utility companies. The boost wind energy provides to the American manufacturing sector is evident in the 400 manufacturing facilities across 43 states, providing good jobs to many Americans. Including wind turbine installation, wind turbine manufacturing, and the whole wind energy value chain, the industry employs over 80,000 Americans—a significant contribution by a growing energy business sector.
Unfortunately, during the past two decades there have been many years when an on again/off again extension of the Production Tax Credit (PTC) was handled in a manner that simply caused market uncertainty, creating a boom and bust cycle for the wind industry. When the PTC has expired in the past, wind turbine installation has dropped between 73%-93%, leaving thousands of Americans out of work. The wind industry has not benefited from the long-term and stable tax credits or subsidies like fossil fuel sources have. In total dollar amounts the oil, coal, gas, and nuclear industries have received $630 billion in U.S. government subsidies while renewable energy has received $50 billion, about 13 times less in government support.
This country needs to adopt long-term energy policy that utilizes America’s potential of producing more affordable and cleaner, renewable energy. If elected politicians listen to the voices of the American people they will extend the PTC and support tax credits for other clean sources of energy. A Wall Street Journal/NBC poll found that 74% of the American people want to eliminate tax credits for fossil fuel to fix our deficit, yet post-election polls showed that a majority of Americans in swing states (Iowa: 77%, Virginia: 76%, Ohio: 75%, Colorado: 72%) are more supportive of candidates who advocate for continued government investment in clean energy. Congress should support the extension of the PTC with bipartisan support to continue the strong growth of a homegrown American industry that has strong, bipartisan American support.