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PTC NOT
EXTENDED DUE TO
PARTISAN GRIDLOCK
Republicans and Democrats Pledge
to Extend Credit Next Year
The wind
energy Production Tax Credit (PTC) will expire December 31 without being
extended. Congress adjourned for the year without agreeing to an
economic stimulus bill containing tax credit extensions, or even passing a
routine one-year extension of expiring tax provisions. Congress is
expected to act on a tax credit extension bill in 2002. The PTC -–
which provides a 1.5 cent per kWh credit (adjusted annually for inflation
and now 1.7 cents/kWh) -– is an important factor in financing new wind
power installations.
A 2-year PTC extension had been included in
the so-called “economic stimulus” bill that Congress has been debating for
the past few months. Despite agreement on nearly every major issue,
negotiations on that legislation ultimately failed due to partisan
differences over how to deliver health care services to unemployed
workers.
A last-ditch effort to extend all 17 expiring tax credits,
including the PTC, also failed. This effort would have involved attaching
the extension to a bill providing financial support for victims of the
September 11 terrorist attacks. The House and Senate adjourned for
the year on Thursday, December 20, closing all possibility for
additional attempts for this year to extend any of the expiring tax
credits.
"Extending the PTC would have allowed the U.S. wind energy
industry to continue expanding, producing new high-tech jobs, boosting
rural economic development and helping achieve cleaner air,” said American
Wind Energy Association (AWEA) executive director Randall Swisher.
“The inability of Congress to extend expiring tax credits means this
economic development will be delayed a number of months into next year,”
Swisher
said.
Key Senators and House members have indicated they
plan to act on a tax extension bill next year. In the past, such
bills have contained retroactive treatment for credits that have
expired. Congress officially returns January 23, 2002, but
realistically will not complete action on tax legislation until the
spring. In the interim, AWEA will be seeking a letter from the
Republican and Democratic leaders of the House and Senate tax committees
indicating their intent to extend the PTC as expeditiously as possible
next year.
"Despite the inability of Congress to extend the
PTC this year, we are very gratified by the strong bipartisan support
expressed for wind energy in both houses of Congress and from the Bush
Administration," said AWEA legislative director Jaime
Steve.
"Sen. Chuck Grassley (R-Iowa) and Rep. Mark Foley
(R-Fla.), both of whom sponsored legislation calling for a five-year
extension, provided strong leadership over the last two years," said
Steve. "They have done a tremendous job of lining up support from
members of Congress.”
Key players in AWEA’s ongoing effort
include House Ways & Means Committee Chairman Bill Thomas (R-Calif.),
Senate Finance Committee Chairman Max Baucus (D-Mont.) and Sens. Tom
Daschle (D-S.D.), Jim Jeffords (I-Vt.), Harry Reid (D-Nev.), Frank
Murkowski (R-Alaska), Jeff Bingaman (D-N.M.), Mike Crapo (R-Idaho), Byron
Dorgan (D-N.D.), Kent Conrad (D-N.D.), Gordon Smith (R-Ore.), Jay
Rockefeller (D-W.V.) and others.
Extension of the PTC was included
in both the Adminsitration's fiscal 2002 budget proposal and its energy
policy plan. "Within the Bush Administration, David Garman
(Assistant Secretary of Energy for Energy Efficiency and Renewable Energy)
was a vigorous advocate for extending the tax credit," said
Steve.
"The ongoing PTC effort has spanned the tenure of current
AWEA president David Blittersdorf (NRG Systems) and past president Dean
Gosselin (FPL Energy). Each made a significant contribution in
building the support necessary to ultimately achieve victory,” Steve
said.
"Particular thanks go to AWEA member companies, individual
members, component suppliers and utility industry and environmental allies
who helped build strong support for an extension,” Steve added.
Since
beginning the PTC effort AWEA and its allies have achieved a number of
milestones, including:
-
Attracting
more than 150 sponsors to the House PTC bill (H.R. 876) introduced by
Reps. Foley, Robert Matsui (D-Calif.), Jerry Weller (R-Ill.) and Karen
Thurman (D-Fla.);
-
Securing 26
sponsors to the Senate PTC bill (S. 530) introduced by Sens. Grassley
and Kent Conrad (D-N.D.), both of whom serve on the tax-writing Finance
Committee; and
-
Gaining
inclusion of the PTC extension within proposed economic stimulus
packages put forward in both the House and Senate.
###
AWEA, formed
in 1974, is the national trade association of the U.S. wind
energy
industry. The association's membership of more than 700 includes
turbine
manufacturers, wind project developers, utilities,
academicians, and interested
individuals from 49 states. More
information on wind energy is available from the home page
of the AWEA
web site: http://www.awea.org/ |
