Let’s start with the good news. An extension to the Production Tax Credit (PTC) has found bipartisan support in Congress. Recent news tells of Democrat and Republican Congressmen from wind states Washington and Iowa recommending an extension of the PTC. Others on both sides of the aisle feel the same way, so our gratitude goes to all in Congress who support the tax credit. That brings us to an important lesson: While some would denigrate opponents and drive them into entrenched positions, a better tactic is to consider them as unconvinced supporters.
You might also call such cooperation tri-partisan support because most Americans recognize the value of an energy producer with zero fuel cost and no pollution, and yet generates gigawatts of power while employing thousands. We know the wind industry is not perfect, but the positive side of its ledger far outweighs its negative side.
Paul Dvorak
The bad news comes from turbine OEM Gamesa. It has been working with partner, Newport News Shipbuilding to design an offshore wind prototype, the G11X-5.0 MW. The collaborative effort, say the companies, focused on turbine reliability, low maintenance and servicing requirements, civil engineering efficiencies in infrastructure development, and cost of energy.
Unfortunately, this work will halt. Although design work on the prototype has finished, an analysis of current conditions suggests that a viable commercial market in the U.S. is as much as three or four years away, at the earliest.
A press release from Gamesa said that while there have been improvements to siting in federal waters, regulatory issues still affect the level and speed at which projects may be approved. The pace of growth is delayed by the lack of an offshore grid. In addition, uncertainty surrounding the Production Tax Credit, which will expire at the end of the year without congressional action, and the lack of a federal energy policy hamper the ability to secure financing for projects.
The company added that without a mature offshore wind market in the U.S., it is extremely difficult to justify the enormous expenditure of capital, engineering effort, and technical resources required to build and install a prototype.
The key to a positive outcome for both stories is, of course, an extension of the PTC. And the key to its extension is to remind its proponents and opponents, gently and gentlemanly, of the PTC’s benefits, those past and those to come.
–Paul Dvorak
Filed Under: News
