PTC extension can avert boom and bust
This article was submitted to the National Journal's Energy Experts blog in response to a discussion question on whether the renewable energy industries face a 'bust' in the future after the boom of recent years.
Boom-and-bust is extremely disruptive to new, growing industries. Instead of making strategic business plans and executing them, companies are forced to lay off skilled employees for indefinite periods and then recall them later or hire and train new workers–a colossal waste of money and time and a wrenching economic hardship for workers and their families, particularly at a time when the overall economy is still struggling.
The Brookings-WRI-Breakthrough report has many useful and valuable things to say about long-term energy policy, and the U.S. certainly needs such a policy, as we have pointed out repeatedly, to seize a foothold in the new growth industry of wind equipment manufacturing and keep jobs from being outsourced to other countries. Still, while we grapple with the difficult process of building a consensus around a new energy policy in a highly partisan political atmosphere, we need to urgently address short-term needs like an extension of the federal wind energy Production Tax Credit (PTC) as well, to avoid serious harm to industries that can contribute to that long-term policy.
The wind power industry shows what can be done with stable policy. In the past five years of bipartisan policy stability, American wind power has:
o Brought in as much as $20 billion annually in private investment to the U.S.
o Created one of the largest providers of new American electric generation with 35% of all new power capacity, right behind natural gas.
o Driven technology advances that have made wind more affordable than ever. A typical wind turbine now generates 30% more electricity – all while driving down costs.
o Created nearly 500 new American manufacturing facilities and employed 75,000 overall, including 30,000 in the manufacturing sector, from coast to coast.
o Produced enough electricity last year to power the entire state of Michigan.
Unlike many other energy policy and legislative provisions, an extension of the wind energy Production Tax Credit has strong bipartisan support. Extension legislation introduced in the House by Congressmen Dave Reichert (R-Wash.) and Earl Blumenauer (D-Ore.) currently has 97 cosponsors, including 22 Republicans, and was strongly supported by Members testifying during a recent House Ways and Means Committee hearing. A Senate bill to extend it was introduced March 15 by seven Senators, including three Republicans. PTC extension efforts have received the endorsement of a broad coalition of more than 370 members, including the National Association of Manufacturers, the American Farm Bureau Federation, the Edison Electric Institute, and the Western Governors’ Association. A PTC extension also has the support of the U.S. Chamber of Commerce, the National Governors Association, and the bipartisan Governors’ Wind Energy Coalition, which includes 23 Republican and Democratic Governors from across the U.S. A PTC extension has been endorsed by a number of newspapers across the country, including the Houston Chronicle, The New York Times, the Denver Post, the Daily Oklahoman, and the Toledo Blade.
Congress should act now to extend the PTC and avoid further harm to one of the country's most promising new energy options. Let wind finish the job of building a new manufacturing industry and making the most of an abundant, affordable, clean, domestic resource.
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