March 8, 2012
U.S.

Sen. Alexander seeks end to wind energy tax credit

By Elijah Herington, Scripps Howard Foundation Wire, www.knoxnews.com 8 March 2012

WASHINGTON – U.S. Sen. Lamar Alexander said it’s finally time to deflate the 20-year-old program that provides federal money to develop wind energy.

The Tennessee Republican member of the Environment and Public Works Committee wants a temporary production tax credit for renewable energies – a provision from the Energy Policy Act of 1992 – to expire.

Alexander has opposed the subsidy for a long time, but said Wednesday he will introduce a bill to end it.

He said wind as an energy source can provide only “puny amounts of expensive, unreliable electricity.” As the provision is set to expire at the end of the year, he said that now may be his opportune moment to strike down the subsidies.

“My major legislative goal in the Senate is to let the tax credit for wind developers to go the way of Exxon oil tax credit and expire at the end of the year,” Alexander told an audience at the Heritage Foundation.

Alexander knows he is fighting an uphill battle. The credit has been extended on four previous occasions.

“There’s likely to be an amendment on the highway bill in the U.S. Senate this week or next week to extend the tax credit for another year,” he said. “That would mean that this temporary tax subsidy that, together with these other subsidies, cost tax payers $14 billion over five years, could be extended yet one more year.”

On top of the history of extensions, Alexander said, “There are more lobbyists per square foot on this issue than I’ve seen in a long time.”

Alexander said funding should be cut because wind energy provides little power for the cost.

“We can’t afford it,” he said. “The federal government borrows 40 cents of every dollar it spends. It cannot justify such a subsidy, especially for what the U.S. energy secretary calls ‘a mature technology.’ ”

Not only is the government borrowing this money, but the small amount of electricity that wind does produce also is unreliable.

Jon Goldstein, director of public affairs for the American Wind Energy Association, said wind energy has been a major success. He said this success has been largely driven by the tax credit.

Since 1980, the price of wind energy has dropped about 90 percent, Goldstein said, and in the past five years, nearly 35 percent of all new American electric generation has come from wind energy.

“It’s the kind of the main federal incentive that’s allowing the tremendous growth in wind manufacturing,” he said.