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The Need to Extend the Production Tax Credit for Wind Energy

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By:
Date:
Location: Unknown

Mr. President,

Today I join my colleague, Senator Mark Udall, on the floor of the Senate to discuss the importance of wind energy and the need to extend the production tax credit for wind. I appreciate Sen. Udall's commitment to the production tax credit for wind energy. He's come to the Senate floor many times during the past several months to highlight the importance of the wind industry in various States. He's been a real leader on this issue.

I've been a long-time supporter of wind energy, beginning with authorship of the first wind production tax credit in 1992. I had no idea at that time the enormous success that the tax credit would become.

The production tax credit for wind is working and should be part of the effort in Washington to help get more Americans working. Nationally, the wind energy industry supports 75,000 jobs. There are more than 400 manufacturing facilities nationwide supplying wind components. Thirty-five percent of all new electricity generation added during the last five year was wind. This is more than coal and nuclear combined. Today, 60 percent of a wind turbine's value is produced in the United States, compared with just 25 percent in 2005.

My home state of Iowa is a leader in wind energy production and component manufacturing. Nearly 20 percent of Iowa's electricity needs are met from wind energy; powering the equivalent of one million homes. Almost 3,000 utility-scale turbines in Iowa generate lease payments to landowners worth $14 million every year. Iowa is behind only Texas nationally in terms of installed wind capacity. The wind industry employs more than 6,000 Iowans.

These jobs are at risk because Congress has so-far failed to extend the production tax credit, which is set to expire at the end of the year. In fact, hundreds of Iowans employed in the wind industry have already been laid off because of slowing demand over uncertainty of the tax credit.

Certainty about tax policy and affordable energy are factors for economic growth.

As much energy as possible -- both traditional and renewable -- should be produced at home to create jobs and strengthen national security. Wind energy is a free resource, and it's abundant in many places around the country. Wind is also a homegrown resource. The electricity it generates is produced on local farms, for local customers, and often adds investment value to the community. A clean renewable source like wind is not dependent on far-away countries with leaders who are hostile to the United States even as they take our energy dollars.

That's why there's broad support for extending this worthwhile policy. Legislation in the House of Representatives to extend the production tax credit has 119 cosponsors, including 25 Republicans. In August, the Senate Finance Committee, with a bipartisan vote, passed an extension of the wind energy production tax credit. The Governors' Wind Energy Coalition and the Western Governors' Association have called for an extension of the production tax credit. The Western Governors' Association is an independent organization representing the governors of 19 states, and current membership includes thirteen Republican and six Democratic governors.

I was pleased to join a press conference a few weeks ago with Senator Mark Udall and over 40 veterans representing Operation Free. They were visiting Capitol Hill to meet with Members of Congress to encourage Congress to extend the wind production tax credit.

The wind energy production tax credit was created to try to level the playing field with coal-fired and nuclear electricity generation. The production tax credit for wind is available only when wind energy is produced. There's no benefit for simply placing the turbine in the ground. It's tax relief that rewards results, and that's much different than failed taxpayer-funded grants and loans made since 2009.

Those who want to do away with the wind energy tax incentive don't seem to mention that other forms of energy have received far more generous tax incentives for many decades longer than the wind energy industry has. Oil and gas and nuclear power all receive longstanding federal support. If we're going to have a discussion of which industries merit federal support and which don't, the discussion needs to be intellectually honest. If we're having that discussion, everything needs to be on the table, not just wind. This extension deserves a place in a year-end package of tax extenders to help give the confidence investors want and employers need to keep and hire workers.

There's no reason to exacerbate the unemployment problem by failing to extend this successful incentive. And, America's security in the short and long term depends on a robust effort to develop domestic energy sources.


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