Lankford chairs hearing on wind tax credits.
Congressman James Lankford (R-OK), chairman of the House Oversight Committee’s Subcommittee on Energy Policy, Health Care and Entitlements, held a hearing today to question IRS’s implementation of a recent change in qualification for the wind production tax credit (PTC).
The hearing examined the effectiveness of the wind production tax credit (PTC) and whether or not the credit should be renewed beyond its intended ten-year window.
“My fellow Oklahomans and I are proud of our nation’s wind producers and their contributions to our all-of-the-above energy solution for North American energy independence,” said Lankford.
“The wind production tax credit (PTC) was first enacted in 1992, when wind was an upstart electric technology. Since then, the wind industry has developed into a thriving, contributing energy producer. However, the PTC was intended to be a short-term tax credit to help wind energy production grow,” stated Lankford.
“The last tax credit extension expires at the end of 2013, but it allows a qualifying wind farm to simply ‘begin construction,’ which could stretch the life of the tax credit well into the next few decades. It is essential the IRS provide clarity on how they will evenly apply the law in a manner that reflects Congressional intent and ensure that only those who meet the qualifications receive the credit.”
According to a recent estimate from Joint Committee on Taxation, another one-year extension of the PTC will cost $6.2 billion, just for wind alone, over the next ten years. A five-year extension for wind would reduce federal budget receipts by $18.5 billion over ten years.
In 2003, wind accounted for about 0.12 quadrillion Btu in power consumed. According to the Energy Information Administration, the projected total for 2013 will be 1.61 quadrillion Btu, rising to almost 1.7 quadrillion for 2014. From 2003 to 2012, wind power consumption increased over a thousand percent. Additionally, wind power as a share of our domestic electricity generation has risen consistently. As of 2012, wind power is 3.46% of American electricity generation. This is up from 0.29% in 2003, representing an almost 12-fold increase in wind’s share of electricity generation in a ten year period.
In all of these metrics, wind energy use is on a steady and uninterrupted rise. Renewable energy portfolios, tax credits and targets have increased the amount of energy generated from renewable sources. Now, it is time to take a fair look at the cost and operation of the PTC to evaluate its role in America’s energy future.