I’m suffering from March madness – only, I’m not talking about college basketball and office-pool brackets. I’m referring to the wind industry’s continual saga to keep intact the production tax credit (PTC).
And as wind developers and suppliers convene next month in Las Vegas for the American Wind Energy Association’s (AWEA) WINDPOWER 2014 Conference & Exhibition, you can expect to hear plenty about the PTC.
The PTC, which gives owners $0.023/kWh for the electricity they generate, is currently expired. However, thanks to a tweak in the program’s eligibility rules, wind projects can still qualify for the PTC if they are placed into service by Dec. 31, 2015. Therefore, you can excuse developers if they’re not feeling the urgency to retroactively extend the tax incentive.
However, given the lead time required for wind development, 2015 is closer than you think.
One experienced wind developer tells me that there’s probably a six-month window remaining to purchase turbines in time to beat next year’s deadline.
Haven’t we heard this before? Wasn’t the PTC the topic of discussion last year – and the year before that?
What is the plan to get the tax incentive retroactively re-instated? What are the prospects for accomplishing such a feat in a gridlocked Congress? Perhaps it’s time to re-examine the need for the PTC.
Maybe it’s time to have an honest discussion about the industry’s preparedness – and readiness – to forgo the wind industry’s chief legislative priority. Sure, there will be some short-term pain. However, wind energy could benefit, too. Let me explain: A prospective purchaser of wind, such as a utility, is less likely to pay full price for wind energy now – without a PTC – if it believes there is a chance to buy it cheaper next year if the PTC is extended.
However, the long-term view needs to be taken into account, as there are valid business reasons for either protecting – or punting – the PTC.
WINDPOWER is the ideal setting for such a frank discussion. Only, spare me the glitz, the slickly produced videos and the pleasantries of an opening general session. I want to hear AWEA’s game plan for moving beyond these start-and-stop times.
Albert Einstein defined insanity as doing the same thing over and over and expecting a different result. Then again, Einstein never worked in the wind industry. Madness, indeed.