NEW BEDFORD – President Barack Obama’s re-election bodes well for the possibility of wind energy jobs in New Bedford, officials and industry analysts said Wednesday.
They said two expiring tax credits would now likely be extended and could lead to investment.
“It’s great news for wind power and it’s great news therefore for New Bedford,” said Rep. Bill Keating, D-Mass., who was re-elected Tuesday in a new district that includes the city.
City leaders are trying to position New Bedford as a hub for the offshore wind industry, which they say is on the cusp of expansion in the Northeast.
The state is investing millions in the proposed South Terminal project, which is currently awaiting final approval by the Environmental Protection Agency.
Cape Wind, on track to be one of the first offshore wind developments in the country, has pledged to use the South Terminal as a staging area, and officials hope other companies will follow suit.
Advocates say the Production and Investment tax credits, which are supported by the president and were given a one-year extension as part of a broader bill passed by the Senate Finance Committee in August, are needed to provide certainty to a still-emerging industry and encourage companies, many of them international, to invest.
“What we’ve learned over the course of our efforts of trying to develop New Bedford as a center for offshore wind is that the investment tax credit for wind energy is critical to getting (the industry) off the ground in the United States,” said Mayor Jon Mitchell.
The Production Tax Credit gives wind companies a 2.2 cent subsidy for each kilowatt hour of electricity produced. The Investment Tax Credit would allow companies to receive 30 percent credit on capital investment when construction starts, opening the subsidy to offshore wind.
Obama has urged passage of both items but, during the presidential campaign, his Republican challenger, Gov. Mitt Romney, spoke against the Production Tax Credit. It has also met resistance in the House, where some Republicans have objected to the extension, which is expected to cost more than $12 million over the next 10 years. [Note: see correction below]
Obama’s election “adds much more stability and a much more measured way for looking at investments,” said Paul Afonso, executive director of the New England Energy Alliance, who served as chairman of the Massachusetts Department of Telecommunications and Energy during Romney’s tenure. “I think it’s overall a very positive factor.”
Even though the makeup of the Senate and the House did not change significantly, Bruce Hamilton, the director of the energy practice at Navigant, a consulting firm that has conducted studies on the market for offshore wind, said he expected the extension of the credits – currently set to expire Dec. 31 – to pass during the lame-duck session, before newly elected members enter office.
“The Republicans were actually holding it up until the election but … it’s no longer an issue that can be used by either side as a political point,” he said, adding that it is supported by some Republicans, those from “windy states.”
“The chances are pretty good that in the overall package of the tax changes, which I think is going to happen at some point, that this will be included,” said Rep. Barney Frank, D-Mass., who is retiring at the end of the year.
Correction dated November 09, 2012:
The Production Tax Credit referred to in a story on wind energy job development in New Bedford is expected to cost more than $12 billion over the next decade. The figure was incorrect in Thursday’s newspaper.
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