Here’s a more balanced look at the benefits of the Production Tax Credit
The Institute for Energy Research, one of the wind industry’s unconverted allies, released a grey paper of invented arguments against renewing the Production Tax Credit (PTC). The last I recall, the House passed the so-called extenders tax package that includes some 55 additional tax breaks, the PTC among them. While the bill awaits debate in the Senate, we offer these rebuttals to the IER’s misinformation. Consider that:
- The PTC is a bargain. It costs taxpayers absolutely nothing. As a tax credit, it rewards production, which means a private company that employs many people can keep more of what it earns. What is the argument against that? The PTC has been a great success. For example, AWEA tabulations show that in 2013, the U.S. wind industry produced 168 billion kilowatt hours of power, about the amount 47 conventional 500 MW plants would produce, and all with zero pollution and fuel costs.
- The PTC has encouraged the growth of the wind industry while utilities shut down old and costly-to-maintain nuclear plants.
- The PTC lets wind-farm owners share the wealth. Owners make lease payments to land owners for use of property and pay taxes that support rural school districts. From AWEA: “With over 98% of all wind-energy projects on private land, wind-energy projects deliver at least $180 million annually in lease payments to landowners.” (via 2014 annual market report http://www.awea.org/AnnualMarketReport.aspx?ItemNumber=6315) . It’s a drought resistant crop say participating farmers. The industry also allows dual land use, for grazing or crops along with power production.
- Americans strongly support the wind industry. Previous surveys by AWEA show that about 70% of Americans, conservative and liberal alike have a favorable opinion of the wind industry. A November 2014 poll by Gotham Research Group (http://www.awea.org/MediaCenter/pressrelease.aspx?ItemNumber=6997) further shows that 79% of Republicans and Democrats strongly or somewhat agree to support the PTC.
- Wind power is a bargain. Wind-farm owners have said that recent turbines can produce power at costs below that of natural gas. (For the current price of natural gas: Bloomberg Energy) Here in the Midwest, we pay about $0.125 per kilowatt hour on power produced from nuclear and coal. Here’s a bit more to support the argument for wind power being affordable: http://truthaboutwindpower.com/truth/the-case-for-wind/affordable/more-info\
- Wind power will lead to a cleaner country. Wind turbines need no scrubbers or fresh water for cooling, and produce no ash. Duke Energy, however, recently had to deal with a costly ($300 million by one estimate) coal-ash cleanup of the Dan River. In addition, the Federal Government maintains some spent nuclear fuel at the Yucca Mountain facility in Nevada, all on the back of American tax payers. A recent Government Accounting Office report is here http://www.yuccamountain.org/pdf/gao_1014.pdf . The first sentence from What GAO found reads: “Spend nuclear fuel – the use fuel removed from nuclear power reactors–is expected to accumulate at an average rate of about 2,200 metric tons per year in the United States.” Wonderful. While our government decides what to do about the Yucca Mountain facility, other spent fuel rods are piling up in cooling basins on the grounds of nuclear plants.
- Wind power and natural gas are natural allies. Although natural gas is currently inexpensive, its price will rise as more use is found for it, such as in transportation and export. Companies such as GE and others have responded with natural-gas driven generators that can start in 15 minutes, making them ideal partners with wind generated power that rises and falls in a predictable manner. What’s more, wind power will make more natural gas available for export at higher prices than if it were sold in the U.S. – another boon to the slow growing U.S. economy.
Renewable energy has produced a disruptive period for the conventional fuel-power producers. Established industries don’t like newcomers elbowing in to a place at the energy-production table. In desperation, opponents to wind power point to the mismanaged economies of Europe as examples of what could happen when governments support the wind industries. But this isn’t Europe. The U.S. economy is slowly improving and many things could be done to speed that up. But change is inevitable.
The PTC is a bargain and a great deal for America, making wind a win. Pass the Extenders bill with a two year extension to the PTC, you in the Senate, sign it quickly, Mr. President, and keep America growing.
–Paul Dvorak
Filed Under: News
Are we “spoiled” if we admit that we have 24/7 on-demand electrical consumption?
Well done, Paul!
Opponents of wind emphasize the volatility of the generation. While we look for the best energy storage solutions to alleviate this concern, we must also consider our part as consumers. We have been spoiled with 24/7 on-demand electricity consumption in the U.S. Having lived overseas for 10 years, where power outages were frequent and often lengthy, we learned to adjust to variable availability. A question we should ask is, “Do I support renewable energy to the degree that I am willing to adjust my lifestyle and curtail my family’s energy demands during times when generation is lower?” Our focus in the past has been on AGC (automatic generation control) but we should also be willing to support load control, or ACC (automatic consumption control), through a smart grid and smart devices. As a parent, I would be fine with the message from my local utility saying, “Curtail electric use by 80%”, which would result in our game-playing and movie-watching and Facebook-chatting youth turning their devices off (or having them turned off) for a few hours to talk with their families, play a game together or read another book.
The demand for unlimited, uninterrupted, energy isn’t a right guaranteed in our constitution and it’s not a basic human need. Providing for future generations with clean, renewable energy is an obligation.
-Brian Pratt