Mitt Romney Supports An End To Wind Tax Credit, Which Could ‘Mean The Loss Of Several Thousand Jobs’
"Mitt Romney Supports An End To Wind Tax Credit, Which Could ‘Mean The Loss Of Several Thousand Jobs’"
Staffers for Mitt Romney’s presidential campaign say the candidate wants to end the wind production tax credit.
That federal credit has allowed the wind industry to compete with heavily-subsidized fossil fuels that do considerable harm to the environment and public health — impacts that are not reflected in their price.
The production tax credit provides wind developers with a tax benefit of 2.2 cents for every kilowatt-hour of wind electricity produced — far below the air pollution damages caused by coal plants. Without Congressional action, the incentive will expire at the end of this year, potentially resulting in the loss of tens of thousands of manufacturing and construction jobs supported by the sector.
Romney has hinted that he wants to end federal tax support for clean energy, but he has not yet made a definitive statement on the production tax credit. However, the Des Moines Register is now reporting that Romney has taken a more concrete stance on the issue:
Mitt Romney’s opposition to wind power could put a damper on Iowa’s wind industry and its thousands of jobs, advocates say.
The federal wind energy production tax credit is set to expire at the end of the year. Staffers for Romney, the likely Republican presidential candidate, said he wants to end the credit, but didn’t specify whether it should be allowed to expire this year or phased out shortly after. President Barack Obama wants an indefinite extension of the tax credit.
Industry insiders and policymakers in Iowa, Republicans and Democrats alike, say ending the credit would hurt Iowa’s blossoming industry.
“It’s really going to slow down the expansion of wind energy,” said Harold Prior, executive director of the Iowa Wind Energy Association. “This could mean the loss of several thousand jobs in the industry.”
The looming threat of an expiration is making it difficult for developers to plan beyond 2012. As a result, wind companies are delaying projects and laying workers off. In Pennsylvania, a turbine manufacturer furloughed 165 workers; in April, an Ohio wind developer scrapped plans for a $20 million project; in Arkansas, Mitsubishi Heavy Industries halted plans for a $100 million production facility; and Vestas, the world’s largest wind manufacturer, may lay off 1,600 workers if the credit expires.
As the Des Moines Register reports, federal policy uncertainty is forcing companies to move activity outside the American market:
One company said the uncertainty over the tax credit’s future has led leaders to focus on exporting its products to other countries instead of banking on domestic buyers. Spain-based Acciona has been assembling wind turbines in West Branch since 2007.
“What we are doing in West Branch is diversifying our portfolio, not just focusing on the United States, but Mexico and Canada as well,” said Joe Baker, chief executive officer of Acciona’s North American windpower unit.
“The uncertainty prevents the investors from committing resources to new wind farms and really creates about an 18-month gap, even if the production tax credit is renewed. Our association has had some companies that have gone out of business because of the uncertainty. They don’t know if they can sustain their operation,” Prior said.
Over the last five years, wind has brought $20 billion in annual private investment to the U.S. — helping support 75,000 jobs and making America one of the most competitive countries in the wind industry. However, the expiration of the credit may force up to 37,000 layoffs in the industry over the next year.
While he supports ending federal support for the wind industry, Romney has fiercely defended tax credits for the mature oil and gas industries.
The Obama campaign has seized on Romney’s contradictory stance in recent months, using it as a messaging platform in the Midwest, where wind provides enormous economic benefits.
“You had our good friend Mitt Romney saying he dismissed wind and solar by saying they’re ‘two of the most ballyhooed forms of alternative energy.’ Tell that to the 7,000 workers manufacturing wind power here in Iowa,” said Vice President Joe Biden at a campaign stop in Iowa.