Why is it so easy for some to be dishonest? Wind industry opponents seem to take great effort to avoid fair and honest remarks with most every pronouncement they make. Of course, if they were honest, their arguments would disappear.
A recent example of their struggle comes from the American Energy Alliance (AEA) in a misguided statement from Kansas Congressman Mike Pompeo and 51 other members of Congress who have joined in opposition to an extension of the wind production tax credit (PTC). In a letter sent to Chairman Dave Camp of the House Committee on Ways and Means, the Congressional signatories call for the permanent expiration of the wind PTC. Wind opponent and AEA President Thomas Pyle released the following statement filled with misrepresentations, half-truths, and dishonesty. A closer reading with my comments in italic will make my points. The statement begins:
“The American Energy Alliance welcomes Congressman Pompeo’s renewed efforts to end this special interest giveaway to the wind lobby.”
Pyle does not hesitate to err in his first sentence: The PTC is not a giveaway, it is a tax credit similar to the tax credit most home owners receive. The PTC rewards production as the home owner’s tax credit rewards home ownership. To condemn one tax credit is to condemn them all. What’s more, the tax credit goes to power producers and not their lobby.
The statement goes on: It is now time for the rest of Congress to follow suit and allow the wind PTC to expire at the end of the year. The expiration of this decades old government giveaway is long overdue, yet the wind industry continues to rake in federal dollars and distort energy markets at great cost to American consumers.
No federal dollars are “raked in”. The tax credit simply lets private companies keep a portion of their income based on the production of their wind farm. That’s worth repeating: the PTC lets companies keep more of what they’ve earned. What is the argument against that? Furthermore, the PTC does not distort markets other than to provide much needed competition. An Xcel Energy representative said at a recent AWEA conference that their more recent wind farms are producing power at costs competitive with natural gas and the savings are passed to customers. What’s more, a recent study by the Union of Concerned Scientists found that in 13 of 14 states with RPSs, power prices have risen less than 1%. To be honest, electric bills will be going up as transmission companies upgrade their 1960s equipment and outdated low-voltage lines.
Last year’s extension of the wind PTC, says the statement, expanded the program and fleeced taxpayers to the tune of $12.1 billion.
This is another gross distortion. The PTC lets wind-farm owners keep $0.023 for every kilowatt-hour produced but only for the first 10 years of turbine life. So more correctly, the PTC rewards production and to be honest, taxpayers will pay absolutely nothing for it.
Also, how was the $12.1 billion calculated? The AEA would have to know how many turbines will be erected to the end of 2014, their capacity factors, and some knowledge of the wind for the next 10 years. That’s quite a forecast. Perhaps the author will share his great natural science insight with local forecasters.
The statement continues: Another one-year extension would add another $6 billon to the tab.
Another baseless allegation. However, to calm the authors’ anxiety, they might like to read Nextera Energy’s analysis of the how wind industry investments boost Federal tax yield here: http://www.nexteraenergyresources.com/pdf_redesign/wind_ptc.pdf
The wind industry is no longer the infant that it professes, says the statement, and no longer needs the wind PTC. The Pompeo effort comes at an important moment as Congress finally begins to consider tax reform.
“Tax reform” today is a scary thought. The last time congress “considered” tax reform, taxes for some people went up. But I would gladly join forces with the AEA if it wants to argue for a reduction in federal spending.
Powerful and well-financed lobbyists are working overtime to push Chairman Camp to bury another wind giveaway in any reform proposal.
I’m flattered to think that someone considers me powerful and well financed.
“Growing bipartisan opposition to the wind PTC signals that the time has come to finally allow Big Wind to stand or fall on its own.”
Growing bipartisan support for the wind industry suggests, I would hope, there will be a modest extension to the PTC. Believe it or not, even the wind industry contemplates the time when the PTC ends, and if I sense it correctly, that will be in just a couple more years.
The wind industry has so much to give American citizens in cleaner air, zero pollution, stable pricing (power purchase agreements are often set for 20 years), lease payments to landowners, taxes to rural communities that dearly need them, and jobs to honest people.
Who knows what the price of natural gas will be in 5 years? Europeans pay about $15/million BTUs versus the U.S. where it is now about $3.60/billion BTUs . If the wind industry lets the U.S. export more natural gas to Europe, that would improve the U.S. economy and even the AEA would agree we need more wind power.
Filed Under: News, Policy