Disagreement On Capitol Hill Creates Uncertainty For Wind Energy

Nov 15, 2017

United States Capitol in daylight
Credit Kevin McCoy

The U.S. House and Senate disagree over whether to slash subsidies for the wind industry.

In 2015, Congress agreed to five more years of a tax credits for wind production. If a company could make headway or finish development of a new project by 2020, they would receive a tax break called a production tax credit, or PTC. It’s helped launch investment in new projects around the country, including Wyoming. The surge in development is expected to add 38 new megawatts of wind energy by 2020 in the states, according to a Bloomberg-related research group.

While the Senate tax plan doesn’t touch the PTCs, the House version slashes them by a third. If that were to happen, the expected 38 new gigawatts of wind energy would drop to only 19 new gigawatts.

Jonathan Naughton, Director of the Wind Energy Research Center at the University of Wyoming, said companies have made their development plans based on the 2020 tax credit deadline “and when you go and change that again, it messes up a lot of industry that’s been planning, making their plans based on the expiration date.”

Naughton added it’s likely that some companies will put their projects on hold.

“If the Senate version goes ahead, I think that the industry will wait to do its final sigh of relief until the actual final tax law comes out and says, ‘Yes, the production tax credit will continue,’” he said.

Naughton said he still expects to see new wind plants even if the tax credits are cut — though perhaps with higher prices and on a new schedule. The House is expected to vote on its tax plan as soon as this week.