After some Mitt Romney-inspired drama, the production tax credit for wind made its way through the Senate Finance Committee, and in solidly bipartisan fashion.
Iowa Republican Sen. Charles Grassley was one of the loudest backers of the measure in the wake of the Romney campaign’s statement earlier this week that the presumptive GOP presidential nominee wanted to kill the wind tax credit. Romney’s opposition didn’t sit well in wind-crazy Iowa, and Grassley, along with Republican Sen. Pat Roberts of Kansas, backed the measure on the committee, joining all the Democrats in a 19-5 vote on Thursday.
“In the face of an effort to end this incentive, I persuaded committee leaders to include the extension in a way that keeps it at full value and that puts the wind-energy production tax credit in a strong position for the floor debate this fall,” Grassley said in a statement.
The PTC, which provides a 2.2-cents per kilowatt-hour tax credit to wind producers, is due to expire at the end of this year. The credit generally has run for two years but hasn’t been allowed to expire since 2004. Every time the tax credit has expired, the wind industry has gone into virtual hibernation – and that’s the forecast again from the American Wind Energy Association. It says 37,000 jobs could be lost if the PTC doesn’t gain an extension, and soon.
The PTC as passed by the Finance Committee as part of a large package of tax breaks still needs to find its way through the full Senate and House – not likely to happen for weeks or months, if at all. But if it does, wind facilities that begin construction – as opposed to the old standard of beginning operation — before the end of 2013 would be eligible for the 10-year credit.
“We applaud the committee for this act of leadership to move critical policies forward in a difficult environment,” Denise Bode, CEO of the AWEA, said in a statement. “This was an extremely important step to provide critical certainty to keep people at work in wind energy manufacturing and construction.”
The AWEA was also happy to see that the committee passed an extension of the investment tax credit (ITC), which provides an incentive for the development of offshore wind and distributed wind.
Earlier this week, Republicans had reportedly moved away from a deal to extend the PTC after Romney declared his opposition to the tax break. But the ranking Republican on the Finance Committee, Orrin Hatch, quickly signaled the possibility of a deal, and such a deal was clinched in late-night negotiations on Wednesday.
Grassley and other Iowa Republicans made no bones about their anger at Romney’s denunciation of the wind PTC. Iowa has become the No. 2 wind power producer in the U.S. and is a center for wind power manufacturing. As Iowa’s Republican governor, Terry Branstad, told Radio Iowa on Thursday, “We have a lot of farmers that receive rent from having wind turbines on their property and we have a lot of jobs associated with it.”
Branstad also took a shot at the Romney campaign’s use of the term “windmills” instead of “wind turbines” — apparently the campaign believes it demeans wind power — in website attacks on the Obama administration’s green energy policies.
“They don’t understand,” Branstad said. “You’ve got a bunch of people that have put that website together that are bunch of East Coast people that need to get out here in the real world to find out what’s really going on.”