Vermont Representative introduces legislation to make it easier to finance renewable energy projects
Joined by Vermont renewable energy companies that are putting Vermonters to work and charting a cleaner energy future, Rep. Peter Welch has announced bipartisan, bicameral legislation that will make it easier to finance renewable energy projects in Vermont and throughout the country.
"MLPs provide the opportunity for increasing capital for renewable energy projects, driving down their cost and helping make projects happen," says David Blittersdorf, president and CEO of AllEarth Renewables, a solar tracker manufacturer based in Williston, Vt. "It makes common sense to extend this financing option currently available for fossil fuels to renewable energy."
At AllEarth Renewables in Williston, Welch outlined his Master Limited Partnership Parity Act, which would allow renewable energy companies to take advantage of a key financing tool used by the energy sector known as master limited partnerships (MLPs). For nearly 30 years, MLPs have driven investment in oil, gas, and coal projects. Under current law, renewable energy projects cannot take advantage of MLPs. Welch’s bill expands the definition of qualified projects to include renewable energy.
“Expanding MLP financing to renewable energy projects will be a boost for the renewable industry and for a cleaner energy future. If oil, gas, and coal projects can take advantage of this important tool, there is no reason why renewable projects should be excluded. This is a simple, common sense idea that will drive investment in renewable energy projects for years to come,” Welch says.
An MLP is a business structure that is taxed as a partnership, but whose ownership interests are traded like corporate stock on a market. Whereas profit from publicly traded corporations is taxed at both the corporate level and the shareholder level, income from MLPs is taxed only at the shareholder level because it is treated as a partnership for tax purposes.
IRS Defines Start of Construction for the Production Tax Credit
The Internal Revenue Service explained today what developers must do this year to be considered to have started construction of new renewable energy projects.
The IRS adopted roughly the same definition for start of construction as under the Treasury cash grant program.
Wind, geothermal, biomass, landfill gas, incremental hydroelectric and ocean energy projects that are under construction by December 2013 will qualify for 10 years of production tax credits on the electricity output or an investment tax credit upon project completion for 30 percent of the project cost.
There is no deadline to complete projects that start construction this year.
The IRS departed from the Treasury cash grant rules in one significant respect.
There are two ways to show that a project is under construction in time.
One is by showing that “physical work of a significant nature” commenced at the site or at a factory that is making equipment for the project. Work at the factory counts only if done after the project has placed a binding equipment order with the manufacturer.
The other is by showing that the developer “incurred” at least 5 percent of the total project cost. Costs are not usually “incurred” merely by spending money; the developer must take delivery or title to services or equipment.
Many developers gravitated toward the 5 percent test under the Treasury grant program because anyone relying on the physical work test had to show a continuous pattern of construction after work started. There was no similar requirement for the 5 percent test. This let tax equity investors and lenders determine with more certainty at the outset whether a project was under construction in time.
The IRS said it will require developers relying on the 5 percent test to show “continuous efforts” in the future on a project. Developers relying on the physical work test will have to show “continuous construction.”
Renewable energy bill passes House, heads to Senate's rocky ground
Florida - A bill exempting renewable energy improvements from property tax assessments passed the House Wednesday, but the bigger hurdle may be in passing the Senate.
HB 277 is the only legislation dealing with renewable energy that is moving in the Legislature.
The bill would implement a constitutional amendment that passed in 2008 with 61 percent of the vote. The amendment also exempted improvements for wind resistance from property tax assessments.
Similar legislation implementing a 2008 constitutional amendment passed the House the three previous years but those bills didn't pass the Senate.
Rep. Michelle Rehwinkel Vasilinda, D-Tallahassee and HB 277 sponsor, said she doesn't know why the bill hasn't passed the Senate but she thinks its prospects are better this year.
That's because it doesn't include exemptions for wind resistance improvements, which could increase the loss of tax revenue for cities and counties.
"I think it makes common sense," she said of the bill. "When people want to make some improvements to their home to lower their utility bills and take part in energy conservation and renewable energy decisions, they shouldn't then have their property values raised for ad valorem taxes."
The Senate companion, SB 1064, has passed two committee stops without opposition votes and has one more stop before it reaches the Senate floor.
Photo credit
Two Energy Revolutions in The State of the Union
It was no surprise that energy and climate change featured prominently in Tuesday's State of the Union speech. The President devoted an entire section of his address to these topics, leading into it in a very upbeat way: "Now is the time to reach a level of research and development not seen since the height of the Space Race. And today, no area holds more promise than our investments in American energy." You'd never guess from that introduction that this president faces a strikingly different energy challenge than his seven most recent predecessors. There are two energy revolutions underway in the US, and the unplanned one is racing ahead of the one to which he devoted most of his remarks--and most of his efforts on energy for the last four years.
Let's start with the positives. Even more than in last year's speech, President Obama presented energy as more of an opportunity than a problem. He described our impressive recent progress in oil and natural gas production, renewable energy generation, and the reduction of greenhouse gas emissions. As fact-checkers have pointed out, he stepped into aspiration when he claimed credit for doubling automobile fuel economy--a goal that might or might not be attained by 2025--but even this fits within a broad set of energy trends that are all finally moving in the right direction.
The President also endorsed a very good idea that has been floating around for a long time, but has never been seized upon. He suggested funding R&D for electric and natural gas vehicles and biofuels with the revenue from federal oil and gas lease bid premiums and royalties. This "Energy Security Trust" would yoke the success of future energy technology to the enormous cash cow represented by the vast oil and gas resources beneath public lands and waters. He'll have to sort out the allocation of revenues with the states, who surely won't want the new set-aside to come from their share. If he can work that out, the government will have an even bigger vested interest in ensuring that responsible oil and gas development on these lands proceeds, in order to advance energy innovation.
The 2013 Renewable Fuel Standard: A 10-Minute Guide
In Washington, the U.S. Environmental Protection Agency (EPA) issued its proposed 2013 Renewable Fuel Standards (RFS2).??The proposal will be open for a 45-day public comment period and EPA will consider feedback from a range of stakeholders before the proposal is finalized.
For 2013, the program is proposing to implement EISA’s requirement to blend more than 1.35 billion gallons of renewable fuels over the amount mandated for 2012.
The Proposed Standard
Here, we have given you the proposed 2013 RFS2 volumes, and the original 2013 targets set under the 2007 EISA legislation. We’ve also provided the final 2012 and 2011 numbers, so that you can evaluate the growth rate in each pool and in the overall Standard.
Note: RFS2 is nested, so the figures for Cellulosic biofuels and Biomass-based diesel are nested inside the overall Advanced Biofuels number — and in turn the Advanced biofuels pool is nested (alongside the corn ethanol target) within the overall Renewable Fuel Standard.
It may sound complex, but it is designed that way so that shortfalls in one pool can be made up by expanding the targets in another pool. That’s why you have to be wary of people who flag a shortfall in one nested pool, for example, cellulosic biofuels. Any shortfalls are easily made up by sourcing qualifying advanced biofuels elsewhere.
Norway to support the renewable energy sector in Angola
The governments of Angola and Norway Friday in Luanda signed a cooperation protocol in the area of renewable energy, for the 2013-2015 period, Angolan news agency Angop reported.
Under the terms of the protocol, Norway will provide technical assistance, organise training for Angolan Energy and Water Ministry staff and support Angola to promote activities for more efficient electricity use in the country.
At the end of the ceremony, the secretary of state for Water, Luís Filipe da Silva, said that Norway was a highly developed country in terms of hydroelectricity and that Angola hoped to benefit from that experience further to improve its energy sector.
“The protocol includes drawing up a proposed strategy and plan of action for rural electrification through use of renewable energy, drawing up proposals for the legal framework of renewable energy development and its uses,” noted the secretary of state.
Norway, according to Silva, will support Angola in improving its technological development, through several activities such as assistance in execution of the investment programme for pre-paid electricity meters, campaigns to raise awareness of more efficient use of electricity, amongst other activities.
Photo via Flickr.
Wind Energy Tax Credit Extension Passes with Fiscal Cliff Deal
On January 1, 2013, Congress passed legislation that included the long-sought extension of wind energy tax credits in a bill to avert the "fiscal cliff" that now moves to President Obama for his expected signature.
The extension of the production tax credit (PTC) and Investment Tax Credit (ITC) is expected to save up to 37,000 jobs and create far more over time, and to revive business at nearly 500 manufacturing facilities across the country. Wind energy PTC, and ITC for community and offshore projects, will allow continued growth of the energy source that installed the most new electrical generating capacity in America last year, according to the American Wind Energy Association (AWEA).
The version included in the deal would cover all wind projects that start construction in 2013. Companies that manufacture wind turbines and install them sought that definition to allow for the 18-24 months it takes to develop a new wind farm.
Leaders of the Senate Finance Committee included that version in a "tax extenders" package they assembled in August, which made it into the overall fiscal cliff deal that passed the Senate early Tuesday morning and the House Tuesday night. President Obama is expected to sign the bill into law swiftly.
The Energy Information Administration said that wind set a new record in 2012 by installing 44 percent of all new electrical generating capacity in America, leading the electric sector compared with 30 percent for natural gas, and lesser amounts for coal and other sources.
U.S. Gauging Interest in New York Offshore Wind Farm Projects
The Obama administration is gauging interest in wind power development off the coast of New York, after a state agency proposed an offshore project 11 nautical miles south of Long Beach.
The Bureau of Ocean Energy Management issued a request today for any competing interests in the proposed lease area, which covers about 127 square miles (329 square kilometers), according to an e-mailed statement. If no other parties express interest, the New York Power Authority can get a lease on a non- competitive basis.
The agency, part of the U.S. Interior Department, is also seeking comments on potential environmental effects of a wind farm in the area. The authority has proposed a project that would generate 350 to 700 megawatts of power for Long Island and New York City.
There are no offshore wind farms currently operating in the U.S. The government has awarded two offshore wind-energy leases, in Massachusetts in 2010 and in Delaware in October, through non-competitive arrangements with Cape Wind Associates LLC and NRG Energy Inc. The administration plans to conduct the first competitive lease auctions this year for projects off the coasts of Massachusetts, Rhode Island and Virginia.
The Long Island - New York City Offshore Wind Project is being backed by the New York Power Authority, Long Island Power Authority and Consolidated Edison Co., according to its website. The Long Island Power Authority canceled plans in 2007 to build a wind farm off Jones Beach after costs rose.
Photo via Flickr.
Virginia utilities, lawmakers to reform renewable energy policy
Virginia lawmakers, environmental groups and utilities are working to revamp the state's 2007 Electric Utility Re-Regulation Act, which is designed to bolster renewable energy generation.
Stakeholders want to reform loophole in the law allows utilities to receive financial credit for renewable energy investments made outside of Virginia.
A November report released by Virginia Attorney General Ken Cuccinelli found that renewable energy standards introduced in 2007 did not address environmental concerns in the state and also led to consumer bill increases over the past five years. The report noted that utilities have purchased RECs from existing renewable generation rather than investing in new development.
But Cuccinelli, who is currently a candidate for governor, did not blame the utilities for the lackluster results and said in a release that they should "not be criticized for making beneficial business decisions based on choices provided or incentives offered by the law."
Virginia environmental groups echoed that sentiment.
Wind power deadline sees US firms rush to build turbines
US energy companies are racing to install wind turbines before a federal tax credit expires at the end of this year.
Experts say that wind power has exceeded the construction of natural gas plants in recent months.
However the financial incentive for wind could be lost as congress struggles to avoid financial deadlock.
Even if the credit is extended it is expected that new installations will decline in 2013.
According to industry analysts, the federal government's production tax credit has played an important role in the expansion of wind energy across the US since it was first introduced in 1992.
Photo via Flickr.
Fate of wind energy production tax credit in hands of Obama, House GOP, officals say
The fate of a tax credit that advocates say is needed to maintain tens of thousands of wind energy jobs will be decided during high-stakes, last-minute negotiations between President Obama and House Republicans over fiscal issues, officials said Tuesday.
The wind energy production tax credit is due to expire at the end of the year. Its extension stalled in Congress this summer amid fierce opposition from some conservative House Republicans. The last chance to extend the measure is in the budget deal that will be cut between Obama and Republicans in the lame duck session of Congress.
Backers of the credit tried to ramp up pressure to extend the $12 billion break Tuesday with a teleconference featuring several governors, who noted that uncertainty over its fate has led to thousands of job losses across the country. A study by a wind energy group found that 37,000 jobs would be lost if the credit expires.
The credit's supporters say the government has subsidized fossil fuels like oil for more than a century. Opponents argue it distorts the energy marketplace and leads to higher prices.
Governors Urge Congress to Renew Wind Energy Production Tax Credit
Salt Lake City, UT -- With the expiration of the wind energy Production Tax Credit looming and the clock ticking rapidly away to the end of 2012, a bipartisan group of U.S. governors is urging Congress to act now to save jobs. In a joint press conference held today, Senator Chuck Grassley (R-IA) stressed that uncertainty over the extension of the wind energy Production Tax Credit (PTC) is already beginning to have an impact on renewable energy jobs.
“The uncertainty about the future of this tax incentive,” Grassley said, “hurts the economic good that these policies do.” Grassley, who authored the original wind energy PTC in 1992 and has also sponsored Senate bill (S. 3521), which aims to extend the tax credit for at least another year, pointed to the expiration of the biodiesel tax credit in 2010 as an example that he says resulted in 23,000 jobs being “put on hold.” This is a situation that all involved are keen to prevent from happening to wind energy in their states.
Governor Terry Branstad (R-IA) also cited uncertainty about the wind energy PTC’s fate as a major playing factor in the decision of some companies to have already begun eliminating jobs. “Due to the uncertainty,” Branstad said, “we’ve begun to see a negative economic impact and loss of jobs in our states. In Iowa, Siemens recently announced the layoff of 400 employees at their plant in Fort Madison, and Clipper Windpower laid off 100 workers at their plant in Cedar Rapids. We have literally thousands of wind energy related jobs in our state. These are high tech, high paying jobs.” Branstad says he remains hopeful that Congress will act quickly to extend the PTC.
Branstad is the chair of the Governors’ Wind Energy Coalition, which is a group comprised of 28 state governors who all share the goal of leveraging wind energy resources as a way to pursue the long-held goal of lasting energy independence.
“Nationally, wind energy drives about $10 to $20 billion a year in private sector capital investment and employs almost 75,000 Americans,” said John Kitzhaber (D-OR), Governor of Oregon and vice chair of the Governors’ Wind Energy Coalition. Kitzhaber used Oregon’s own Sherman County as an example of how rural communities can utilize wind energy production to drive revenue. “The county now receives $33 million per year in revenue from wind farms,” Kitzhaber said. “That’s revenue that has proved essential to sustain schools, fire departments and road maintenance.”
Hawaii issues new rules for renewable energy tax credit
HONOLULU - The state Department of Taxation on Friday issued new rules for the renewable energy tax credits that have spurred more residents to install solar panels.
The department said it is doing so to provide clarity to taxpayers, but environmentalists and renewable energy advocates said the new rules jeopardize the state's progress in moving away from imported fossil fuels.
The rules, which will take effect on Jan. 1, require renewable energy systems to meet set output capacity requirements. The Sierra Club and Earthjustice said the change would limit the solar tax credit for the average residential solar power system to $5,000. This would effectively cut the tax credit in half and put solar power out of the reach of many families, they said.
The department explained its decision by saying the previous rules, issued in 2010, created uncertainty and an unlevel playing field. The department has been receiving complaints about the rules for more than a year, it said.
The law grants residents and businesses a tax credit for installing a renewable energy system. Some people, however, have been advised by the companies putting in their solar panels to say their installation consists of multiple systems and then claimed the credit multiple times. This has made solar panels more affordable and encouraged many more people to buy them but it's also depleted tax revenues and made it harder for the state to balance its budget.
"After listening to taxpayers concerns, the department is issuing these new temporary rules in order to provide consistent, uniform and fair application of the tax credit law, while still supporting the State's public policy goal of reducing our reliance on fossil fuel," the department said in a statement.
Photo via Flickr.
Obama Administration Approves Roadmap for Utility-Scale Solar Energy Development on Public Lands
WASHINGTON, D.C. - As part of President Obama’s all-of-the-above energy strategy to expand domestic energy production, Secretary of the Interior Ken Salazar today finalized a program for spurring development of solar energy on public lands in six western states. The Programmatic Environmental Impact Statement (PEIS) for solar energy development provides a blueprint for utility-scale solar energy permitting in Arizona, California, Colorado, Nevada, New Mexico and Utah by establishing solar energy zones with access to existing or planned transmission, incentives for development within those zones, and a process through which to consider additional zones and solar projects.
Today’s action builds on the Administration’s historic progress to facilitate renewable energy development. On Tuesday, with the authorization of the Chokecherry and Sierra Madre Wind Energy Project site in Wyoming, Interior reached the President’s goal of authorizing 10,000 megawatts of renewable power on public lands. Since 2009, Interior has authorized 33 renewable energy projects, including 18 utility-scale solar facilities, 7 wind farms and 8 geothermal plants, with associated transmission corridors and infrastructure. When built, these projects will provide enough electricity to power more than 3.5 million homes, and support 13,000 construction and operations jobs according to project developer estimates.
“Energy from sources like wind and solar have doubled since the President took office, and with today’s milestone, we are laying a sustainable foundation to keep expanding our nation’s domestic energy resources,” said Secretary Salazar, who signed today’s Record of Decision at an event in Las Vegas, Nevada with Senator Harry Reid. “This historic initiative provides a roadmap for landscape-level planning that will lead to faster, smarter utility-scale solar development on public lands and reflects President Obama’s commitment to grow American made energy and create jobs.”
The Solar PEIS establishes an initial set of 17 Solar Energy Zones (SEZs), totaling about 285,000 acres of public lands, that will serve as priority areas for commercial-scale solar development, with the potential for additional zones through ongoing and future regional planning processes. If fully built out, projects in the designated areas could produce as much as 23,700 megawatts of solar energy, enough to power approximately 7 million American homes. The program also keeps the door open, on a case-by-case basis, for the possibility of carefully sited solar projects outside SEZs on about 19 million acres in “variance” areas. The program also includes a framework for regional mitigation plans, and to protect key natural and cultural resources the program excludes a little under 79 million acres that would be inappropriate for solar development based on currently available information.
Wind Energy Jobs, PTC Surface At Second Presidential Debate
The first presidential debate came and went without mention of the wind
energy production tax credit (PTC) and hardly any discussion of
renewables. The story was quite different, however, at the second debate
between President Barack Obama and Republican presidential candidate
Mitt Romney, held Tuesday night at Hofstra University in Hempstead, N.Y.
In
fact, energy was arguably one of the most contentious issues of the
night, and sparked heated disputes between the two candidates, who
traded jabs on policies that - as described Tuesday night - did not
differ all that much.
Obama has said he favors an "all of the
above" energy approach, including oil, gas, wind, solar and biofuels - a
position he stated in the first presidential debate and reiterated
Tuesday night.
“We’ve got to control our own energy, you know -
not only oil and natural gas, which we’ve been investing in - but also,
we’ve got to make sure we’re building the energy sources of the future,”
he said at Tuesday’s debate. “Not just thinking about next year, but 10
years from now, 20 years from now. That’s why we’ve invested in solar
and wind and biofuels, energy-efficient cars.”
And despite the virtual absence of renewables from Romney’s official energy plan, released in August, this time, the former Massachusetts governor also expressed support for clean energy like wind and solar power.
“Look,
I want to make sure we use our oil, our coal, our gas, our nuclear, our
renewables,” he said. “I believe very much in our renewable
capabilities - ethanol, wind [and] solar will be an important part of
our energy mix.”
At
the first debate, neither candidate mentioned the jobs being lost in
the wind energy supply chain due to the looming expiration of the PTC.
The
PTC’s omission from the first debate may have seemed glaring to some in
the wind industry, considering that the president had made the critical
tax credit a cornerstone of his campaign efforts in Iowa and Colorado - two states that have lost hundreds of wind energy jobs over the past few months.
This time, however, Obama came out swinging against Romney, who has stated he would let the PTC expire at the end of this year.
“What
I’m not for is us ignoring the other half of the quotation,” Obama
said, referring to renewables. “So for example, on wind energy, when
Gov. Romney says these are ‘imaginary jobs,’ when you’ve got thousands
of people right now in Iowa, right now in Colorado who are working,
creating wind power, with good-paying manufacturing jobs - and the
Republican senator in that, in Iowa, is all for it, providing tax
credits to help this work - and Gov. Romney says, ‘I’m opposed; I’d get
rid of it’ - that’s not an energy strategy for the future.”
Romney refuted the claims, saying he does, in fact, support wind jobs.
“I don’t have a policy of stopping wind jobs in Iowa, and they’re not phantom jobs - they’re real jobs,” he said.
“I
appreciate wind jobs in Iowa and across our country,” he added. “I
appreciate the jobs in coal and oil and gas. I’m going to make sure that
taking advantage of our energy resources will bring back manufacturing
to America. We’re going to get through a very aggressive energy policy,
3.5 million more jobs in this country.”
Louisiana's Solar Tax Credit Under Review
Louisiana, USA -- The Louisiana Department of Revenue weighed the future benefits of solar energy at a public hearing last week in Baton Rouge. Homeowners in Louisiana can choose solar-generated electricity and realize a 50-percent, one-time, refundable, state income tax credit for the purchase and installation of the system under provisions of the Wind and Solar Energy Systems Tax Credit created by state legislation in 2007.
Louisiana’s investment in this incentive program is something the solar energy industry does not want to see fade away.
Nearly 100 people, from all over the state and nation, filed into the hearing room to shed some light on LDR’s rules for the Income Tax Credits for Wind or Solar Energy Systems.
The solar power industry generated more than just energy that day as more than a dozen people registered to speak.
“It appears there was a lot of interest,” said Byron Henderson, press secretary for the Department of Revenue, “This is just a public hearing on proposed rule changes for the tax credits on the wind and solar energy systems.”
Tucker Crawford, co-owner of a Louisiana-based solar energy company and president of the Gulf States Renewable Energy Industries Association – which is a non-profit, trade organization that represents solar and renewable energy firms in Louisiana, Mississippi and Alabama– told the committee that the entire Louisiana solar industry has far exceeded the state’s initial estimates.
“That’s a good thing to Louisiana energy consumers,” Crawford said. “In 2007, Louisiana only had five licensed solar installers. Today, we have 196 and counting; many of them are represented here today.”
Crawford said that the 2007 state law – which allowed income tax credits for wind or solar energy systems purchased and installed by taxpayers to cut costs on their homes or buildings – has created local jobs, increased the state’s energy independence and reduced or eliminated utility bills for more than 3,100 Louisiana households.
19 Companies Urge Congress To Extend Wind Tax Credit
A group of 19 leading companies has sent a letter to Congress asking lawmakers to immediately extend a key tax credit for wind that is set to expire at the end of the year.
The diverse coalition of firms, which includes Ben & Jerry’s, Johnson & Johnson, Levi Strauss, Starbucks, and Yahoo!, says that raising taxes on the wind sector would be bad for businesses that buy large amounts of wind electricity.
These companies join a very large bi-partisan chorus of renewable energy supporters asking Congress to give the wind industry some certainty and put the sector on a level tax playing field with the oil and gas industry, which enjoys billions of dollars in permanent tax benefits.
Over the last year, the National Governor’s Association, County Commissioners, and numerous Republican politicians have all sent separate letters to Congressional leaders in support of extending federal wind tax credits for at least another year. Now this latest group of prominent companies is playing up another theme: Ending support for wind isn’t just bad for the wind industry, it’s bad for downstream non-utility companies that procure energy from wind:
"As major U.S. employers and some of the largest non-utility purchasers of renewable energy, we urge you to extend the Production Tax Credit (PTC) for wind energy before the end of the 112th Congress. A failure to pass an extension will amount to levying a tax on companies committed to buying American energy and growing the U.S. economy. In today’s economic climate, a taxhike on American businesses buying American renewable energy is unwarranted.
"In the past decade American businesses have significantly ramped up their purchase of American wind energy. For consumers of wind electricity, the economic benefits of the PTC are tremendous. Electricity rates, which reflect marginal costs for power plant operations and fuel prices, consistently decrease when wind enters the market. Because wind prices can be locked in up front, businesses incorporating wind into their energy portfolios are better equipped to hedge market volatility in traditional fuels markets caused by supply shocks. We are concerned that allowing the PTC to expire will immediately raise prices for the renewable electricity we buy today."
California Congresswoman Capps Joins in to Pass Legislation to Extend Renewable Energy Tax Credits
Congresswoman Lois Capps (CA-23) joined her colleagues in the Sustainable Energy and Environment Coalition (SEEC) on the floor of the House of Representatives urging the Speaker to immediately renew tax incentives for wind energy. The renewable energy Production Tax Credit (PTC) provides an income tax credit for each kilowatt-hour of electricity produced by a renewable energy source, including wind, and has been a key factor in the expansion of clean energy over the last decade.Unfortunately, the PTC is set to expire on December 31st of this year without Congressional action. A recent report from the U.S. Department of Energy highlighted the importance of extending the PTC to ensure growth in wind energy production and manufacturing.
Video of Capps’ floor statement is available here.
With precious few weeks left in the Congressional calendar, it’s time for the Speaker of the House to stop holding bipartisan legislation to extend tax incentives for wind energy hostage,” said Capps. “The country cannot afford to wait any longer to develop wind energy projects that will create jobs and move our country forward to a cleaner, healthier future.”
In May, Capps spoke about the PTC’s role in creating jobs on the Central Coast with employees at Infinity Wind Power of Santa Barbara. She has co-sponsored bipartisan legislation, the American Renewable Energy Production Tax Credit Extension Act of 2011 (H.R. 3307) to extend the PTC through 2016. She also wrote to the Speaker in May urging him to bring this legislation to a vote. Earlier this month, the Senate Finance Committee included extension of the PTC when reporting a bipartisan tax bill just before Congress adjourned for the August district work period, but the House has yet to act.
Feed-in Tariffs Do More for Wind at Less Cost to Ratepayers than RPS, Says German Agency
In a recent report, the German Renewable Energy Agency says that across Europe countries using feed-in tariffs develop more wind energy and pay less for it than countries using quota systems.
In North America, the quota model is known variously as Renewable Portfolio Standards (RPS) or Renewable Energy Standards.
The agency, the Agentur für Erneuerbare Energien, says that RPS-related tendering programs raise the payments for wind energy in Europe to as much as €0.15/kWh ($0.19/kWh) in Italy. In contrast, Germany, which uses a feed-in tariff, pays only €0.089/kWh ($0.11/kWh). Spain, which also uses a feed-in tariff, pays even less.
Germany operates the most wind energy capacity in Europe, 29,000 MW, Spain follows with nearly 22,000 MW.
Italian wind generation has fallen behind electricity generation from solar photovoltaics for the first time in an industrialized country. Italy uses feed-in tariffs to pay for solar energy instead of a trading system in green certificates, one of the hallmarks of a quota system.
Great Britain, which also uses a quota system for large-scale wind energy and has the best wind resources in Europe, pays 20% more for wind energy than Germany: €0.108/kWh ($0.135/kWh). More than half of German wind capacity is now installed in lower wind areas of mid-Germany and yet Germany still pays less than Great Britain for wind energy.
Payments for wind energy normally reflect the costs of wind energy and costs are substantially less where the wind resources are greater. Thus, it is unusual that Britain pays more for wind energy than Germany even though its wind resource is so much better.
Posts
