The uncertainty surrounding a wind industry tax credit decreased General Electric’s energy infrastructure revenues 5 percent in the third quarter as wind turbine sales dropped, the company said Friday.
Overall, GE’s quarterly earnings rose 8 percent. And excluding wind and the impact of foreign-currency exchange, infrastructure orders would have increased 4 percent, GE CEO Jeff Immelt said during the firm’s quarterly earnings call.
The 2.2-cent per kilowatt-hour credit for wind power production that Immelt referenced in the call is scheduled to expire Dec. 31.
GE’s performance reflected the wind industry’s concerns that letting the credit expire could reverse recent progress.
The American Wind Energy Association (AWEA) said the credit drove much of the industry’s third-quarter growth. Installations of new wind electricity capacity rose by 1,833 megawatts during the quarter, the industry group announced Thursday. Installed capacity has increased 40 percent through the quarter compared with 2011, it said.
Analysts predict a drop in wind installations for 2013 as private investors remain skittish about opening their pocketbooks, given the credit’s cloudy future.
A $205 billion tax extenders package that awaits a Senate vote includes a one-year extension for the credit. Senate Majority Leader Harry Reid (D-Nev.) said he is “very confident” the credit will pass the Senate.
The House has yet to seriously discuss the credit. Military veterans who work in the wind industry pleaded their case for an extension with House Ways and Means Committee Republicans in a series of meetings on Thursday.
For the most part, resistance to extending the credit rests with Republicans. They have called the credit unwise, saying it permits government intervention in energy markets. Many also want to hold out for a broader revision of the federal tax code.
GOP presidential candidate Mitt Romney has said he opposes extending the credit, while President Obama supports it.
Obama has tried to turn Romney’s position on the issue into a political liability in wind-heavy swing states such as Iowa and Colorado.
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