On Wednesday, U.S. Department of Energy Secretary Steven Chu and Sen. Mark Udall, D-Colo., held a town-hall-style webcast focused almost exclusively on wind energy and the urgent need to extend the production tax credit (PTC).
During the informational session, which also included a Q&A segment, Chu officially endorsed the extension of the PTC and re-emphasized his unwavering support for wind power and other forms of renewable energy.
"I'm bullish on the prospects for wind," Chu told reporters and webcast viewers. "We have to maintain the production tax credit. That's my plug."
After highlighting many of the wind industry’s achievements over the past two decades, Chu warned that if the PTC is not extended, many manufacturers established in the U.S. will likely move overseas.
Udall - who has given dozens of speeches in the Senate emphasizing the PTC’s importance - echoed Chu’s call to action on renewing the tax credit.
“How it’s going to happen, I don’t know,” he admitted. “Keep routing for us.”
Both panelists noted, however, that the PTC will be just one part of ensuring the U.S. continues its renewable energy growth into the future. A federal clean energy standard, proposed on several occasions by Sen. Jeff Bingaman, D-N.M., could be one path, as could amending the tax code to level the playing field for renewable energy.
Chu encouraged the use of master limited partnerships (MLPs) a way to spur renewable energy development without burdening taxpayers. MLPs - which allow regular investors to purchase shares in publicly traded partnerships - have been used for decades in the oil and gas industries but are not allowed for renewables.
Opening up MLPs to wind and solar projects, Chu explained, will lower financing costs, which will, in turn, lower capital costs and spur private-sector investment in renewables.
Thanks to technological improvements, such as higher towers and more-efficient designs, the costs of wind energy have plummeted over the last 10 years and will only continue to fall over the next decade, Chu noted.
“It is a false choice” to choose between renewable energy and cheap energy,” he said. Chu pegs the average cost of wind power at about $0.072/kWh and predicts that it will fall to about $0.05/kWh to $0.06/kWh within the next decade, rivaling the price of natural gas.
Transmission and distribution will be key challenges, Chu acknowledged, but even without energy storage, the grid has the capacity to accommodate more wind energy. Eventually, utilities will get on board, he said, because with renewables and grid modernization, there is “money to be made by everybody.”