North Dakotans can’t count on the wind blowing every day, but extending a federal tax credit for five years would put a steady breeze in the sails of the state’s booming wind industry, Rep. Earl Pomeroy said Monday.
Pomeroy, D-N.D., visited the DMI Industries manufacturing plant in West Fargo to announce a bipartisan bill to extend the production tax credit for wind and other renewable energy projects until 2014.
“This legislation “¦ we think produces a very significant level of stability, providing the assurance that those contemplating moving in this area are going to be able to complete their projects and invest in future projects,” he said.
Before adjourning last month, the 2006 Congress extended the tax credit for one year, through Dec. 31, 2008. The tax credit provides 1.9 cents per kilowatt hour for electricity generated during the first 10 years of a wind turbine’s operation.
Pomeroy said the tax credit has expired three times since 1999. When it last happened in 2003, 2,000 jobs were lost across the country, causing “tremendous disruptions” to the industry, he said.
“What happens when the production tax credit expires is that orders stop, factories close, research comes to a halt,” he said.
The wind tower industry has benefited from the last two extensions occurring before the tax credit expired, said Lars Moller, president of DMI Industries. The company’s work force has expanded from about 75 in 2004 to nearly 500 today ““ roughly 350 in West Fargo and 140 in Fort Erie, Ontario, he said.
A five-year extension would make the wind industry more balanced “and allow us to think a little bit more long term than the one- or two-year extensions that we’ve seen in past years,” Moller said.
Blake Seas, general manager of LM Glasfiber Inc. in Grand Forks, said the wind-blade manufacturer had to lay off employees when the tax credit expired, hurting the company’s reputation and making it difficult to rehire.
“It’s been tough for us in the past, but with the stable policy we’ve had the past couple years, we’ve seen enormous growth,” he said.
LM Glasfiber stabilized with about 320 workers last summer and is now up to 720, with most of the additional workers hired in the last three months, Seas said.
Pomeroy said the Congressional Budget Office has yet to estimate the cost of a five-year extension.
He said he’d like to see the tax credit made permanent.
By Mike Nowatzki
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