AWEA Legislative Priorities

Description: Under present law, an income tax credit is allowed for the production of electricity from qualified wind energy facilities and other sources of renewable energy. The current value of the credit is 2 cents/kilowatt-hour of electricity produced. The credit was created under the Energy Policy Act of 1992 (at the value of 1.5 cents/kilowatt-hour, which has since been adjusted annually for inflation) and applies to electricity produced by a qualified wind facility placed in service after December 31, 1992, and before January 1, 2009. The production tax credit (PTC) is only applicable to utility-scale wind turbines, not smaller turbines used to power individual homes or businesses.

Current Status: The PTC is scheduled to expire on December 31, 2008. Since its establishment in 1992, the PTC has undergone a series one or two year extensions, and has been allowed to lapse in three different years: 1999, 2001 and 2003. The federal government’s uninterrupted commitment to the PTC from 2005 through the present has given the industry a steady base to build upon, enabling three straight years of growth. The most impressive expansion of the wind industry was seen in 2007, when a record 5200 megawatts of new wind power capacity were added.

The PTC enables utilities, wind energy developers and manufacturers to invest billions of dollars each year in equipment and facilities associated with the generation of electricity from renewable energy resources, such as wind, geothermal, biomass and hydropower. Since investment decisions are being made today for new wind power projects that are not expected to be completed until next year, wind energy companies are already reporting a decrease in investment as a result of the uncertainty surrounding tax policy. If Congress does not act soon to extend the PTC, companies will stop making investments in projects not expected to be completed before the end of the year. The result will be the loss of thousands of jobs in construction, manufacturing and maintenance at a time when renewable energy is a bright spot of surging growth in a troubled economy. Based on AWEA’s projected impact on wind installations, allowing the PTC to expire would cause a loss of approximately 75,000 jobs in a single year.

AWEA seeks to secure prompt Congressional action to extend the production tax credit. A long-term, full-value PTC will provide the industry with optimal certainty and stability.

Current legislation: Renewable tax incentives were part of the December 2007 energy bill tax title, which failed to overcome a Senate filibuster by a single vote. Immediately following that vote, House and Senate leaders committed to return quickly to the issue. The avenue through which the PTC will be extended is yet to be determined.

Take Action: The PTC will expire on December 31, 2008. You can help us make a difference. Click on the Legislative Action website to send FREE messages to Congress.

Urge your Senators and Representative to support a prompt extension of the PTC. Let them know you support wind energy.

Description: The renewable electricity standard (RES), also known as a renewable portfolio standard (RPS), uses market mechanisms to ensure that a growing percentage of electricity is produced from renewable sources, like wind power. The RES provides a predictable, competitive market, within which renewable generators will compete with each other to lower prices.

Benefits of an RPS:
Helps Keep Electricity Bills Low:

Diversifying the power supply by developing America’s homegrown renewable energy resources helps shield consumers from spikes in energy prices.
Does not pick technology “winners” and “losers,” but allows renewable energy technologies to compete against each other to further drive down costs.
Is competitively neutral because it applies equally to all competing market participants.

An RPS will create jobs and income in rural areas.
Each large utility-scale wind turbine that goes on line generates over $1.5 million in economic activity. Each turbine also provides about $5,000 in lease payments per year for 20 years or more to a farmer, rancher or other landowner.
Wind projects in rural areas contribute significantly to the local tax base.

Increasing our use of renewable sources diversifies and decentralizes our energy infrastructure.

The increased use of electricity from renewable resources can help reduce emissions of harmful air pollutants and of carbon dioxide (a leading greenhouse gas).

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Current Status State RES: 25 States and the District of Columbia have adopted RES requirements. Download the fact sheet for more details on each state RPS.

Fact Sheet – State-level Renewable Portfolio Standards

Current Status National RES: A 15 percent national Renewable Electricity Standard passed the U.S. House for the first time in 2007, but was dropped from the bill in the Senate when the energy package failed to secure the 60 votes needed to overcome a filibuster.

Current Legislation: There is currently no RES legislation pending at the federal level.

Fact Sheet - National Renewable Electricity Standard

Take Action: Ask Congress to support a national Renewable Electricity Standard. You can help us make a difference. Click on the Legislative Action website to send FREE messages to Congress.

Tell your Senators and Representative that an RES is crucial to the industry’s long-term growth.

Current Status: A handful of states provide some incentives for small wind, but the federal government has not provided any assistance since 1985. The federal Production Tax Credit (PTC) covers only large utility-scale wind projects, not individuals who want to install their own wind power systems for on-site power. In 2005, Congress passed an energy bill that included an investment credit for residential solar energy applications, but did not include small wind systems.
In 2007, a small wind tax credit was included in farm policy legislation (S. 2242), which could become law in 2008. The Farm bill contains a provision that would provide a new investment tax credit of $500 per half kilowatt (kW) of capacity, capped at $4,000, for the purchase of small wind systems used to power homes. The credit would last through 2012.

Current Legislation: S. 2242 (Senate) would contain a provision that would provide an investment tax credit for small wind systems used to power homes.

Take Action: Ask Congress to support a small wind systems tax credit. You can help us make a difference. Click on the Legislative Action website to send FREE messages to Congress.