WASHINGTON – On Thursday, the Senate Finance Committee scheduled a mark-up of legislation to extend tax credits for certain special interests, including the wind energy production tax credit (PTC). Senator Chuck Grassley (R-Iowa) announced he will offer an amendment to add the wind PTC, which expired at the end of 2013. A one-year extension is estimated to cost $12 billion over 10 years.
Director of the Competitive Enterprise Institute’s (CEI) Center for Energy & Environment Myron Ebell issued the following response to this effort:
“The tax credit amounts to a subsidy for well-connected government cronies to produce a product that cannot compete in the energy marketplace on either price or reliability.
“Congress should not once again extend special interest tax breaks for Big Wind, an industry that has had more than 20 years of federal handouts paid for by taxpayers. Big Wind spends more time seeking handouts than trying to make their product competitive.
“The tax credit amounts to the worst kind of cronyism, giving a tax break to one politically-favored industry and encouraging other down-wind problems, such as state renewable energy mandates that lead to higher electricity rates for consumers and manufacturers.
“Let’s not forget that over a decade ago Sen. Grassley said wind only needed five and at most 10 more years of government handouts to become competitive.”
NOTE: Grassley’s amendment would reportedly extend the credit for two years at the past level of 2.3 cents per kilowatt-hour. Grassley said circa 2002-3: “I’d say we’re going to have to do it for at least another five years, maybe for 10 years. Sometime we’re going to reach that point where it’s competitive [with other forms of energy]. I think the argument for any tax credit is to make the new source of energy economically competitive.”