This was in 1998, after the industry had already been thriving for some time. Ten and then 20 years later, we are still waiting for evidence that all that public investment and environmental and societal havoc has been worth it, even as the wind industry continues to beg for more. Scans by courtesy of The Smoking Gun .
Kenneth L. Lay
Chairman and Chief Executive Officer
P.O. Box 2288
Houston, TX 77251-2288
August 10, 1998
The Honorable George W. Bush
The State of Texas
State Capitol, Room 2S.1
Austin, Texas 78701
Governor Bush: George
I am writing to bring to your attention a federal tax bill that will benefit Texas and to ask you to write a letter to House Ways and Means Committee Chairman, Bill Archer, expressing your support for the measure.
The bill, H.R. 1401 (Thomas R-CA), extends for five years the existing wind production tax credit (PTC), which was passed by the Bush Administration in the Energy Policy Act of 1992. Wind is the fastest growing new electrical generation technology in the world today and has rapidly decreased its production costs until it is close to being competitive with conventional generation technologies.
Texas has great wind potential which is already being developed. Among the projects are a 35 MW project operating near Van Horn (LCRA), a 40 MW project under construction near Big Spring (Texas Utilities), a 6 MW project near Fort Davis (Central and Southwest), and a 75 MW project being bid near McCarney (Central and Southwest). These projects represent a $156 million investment in Texas.
In addition to the actual projects, our subsidiary company, Enron Wind Corp., as one of the largest wind turbine manufacturers in the world, is spending approximately $80 million for wind turbine components in Texas. A new blade manufacturing plant is operating in Gainesville and the towers are being fabricated in El Paso.
The PTC bill and its Senate version S. 1459 have broad-based support. Twenty-three out of thirty-nine Ways and Means Committee members and ten out of twenty Senate Finance Committee members are co-sponsors. I would like to make several points concerning the PTC:
1. The PTC is an existing credit in the tax code scheduled to expire June 30, 1999. The proposed extension will sunset in five years.
2. Fossil technologies (coal, oil, gas) will receive approximately $12.6 billion in tax benefits in the five year period 1998-2002. In comparison the PTC extension will cost the treasury $134 million.
3. The PTC is production based, not investment based, thus encouraging design and cost improvements to increase production.
5. Wind energy is creating many new jobs around the country and particularly in Texas. These new jobs create significant tax income on the federal, state, and local levels and the tax multiplier effect creates more tax revenues than the cost of the PTC over the five year period.
6. The export potential of wind energy equipment is also large and growing with a potential market of $2 billion per year. U.S. manufacturers such as Enron can capitalize on those foreign markets to the benefit of our economy.
The outlook for wind projects and wind-related manufacturing in Texas is very good. I would greatly appreciate your help in sending a letter to Chairman Archer supporting the PTC for wind because it is a technology that will offer long-term economic and environmental benefits not only to Texas and our country, but to the world as a whole.