Hope for a revival of the wind production tax credit (PTC) has been buoyed, as a two-year extension of the incentive has made its way into a newly passed Senate Finance Committee tax extenders bill. An earlier version of the bill, released by Committee Chairman Ron Wyden, D-Ore., on Tuesday, did not include the PTC.
Sens. Charles Grassley, R-Iowa; Michael Bennet, D-Colo.; and Maria Cantwell, D-Wash., had pushed for an amendment to add the PTC extension prior to a committee markup hearing on April 3. The bill also includes a two-year extension of the investment tax credit (ITC). Both incentives expired on Dec. 31, 2013, and the legislation would extend them through Dec. 31, 2015.
The Senate Finance Committee passed the tax extenders package Thursday afternoon and has sent it to the Senate floor.
"We're grateful to all the supporters of renewable energy on the Senate Finance Committee," says Tom Kiernan, CEO of the American Wind Energy Association (AWEA), in a statement. He adds that the vote "provides a critical signal for our industry."
According to AWEA, a number of Senators on both sides of the aisle highlighted the success of the PTC and ITC during the hearing. Grassley spoke at length in favor of the tax credits and called arguments against their extension from Sen. Pat Toomey, R-Pa., "intellectually dishonest."
John Thune, R-S.D., then withdrew a proposal to phase down the PTC, saying that discussion belonged in comprehensive tax reform, not the debate over the extenders package. Sen. Michael Bennet, D-Colo., called the PTC "vitally important" to his state – an incentive that is "driving not just economic growth, but job growth and wage growth."
Lately, loud support for PTC and ITC extensions has been prevalent among elected officials. Last month, 144 Congress members signed letters urging their colleagues to act quickly to revive the incentives. Twenty-six Senate members signed the letter to Wyden, and 118 House members signed the letter to Speaker John Boehner, R-Ohio. Furthermore, President Barack Obama's recent fiscal-year 2015 budget proposal reiterated his call for a permanent PTC.
Nonetheless, some groups had urged the Senate Finance Committee not to include the incentive extension. For example, conservative advocacy Americans for Prosperity issued the following statement on April 2: ‘Wind energy companies have been receiving special handouts from the Obama administration for years and still haven't been successful. It's time for Congress to put an end to this corporate welfare and encourage a free market in the energy industry that will lower costs for Americans across the country.’
Although the Senate Finance Committee reported out the tax extenders bill, which includes about 50 other expired provisions, the battle is likely far from over.
As David Burton, a partner at law firm Akin Gump Strauss Hauer & Feld, points out, the vote is "a first step in a long journey and unlikely on its own to create enough confidence to spur investment in the development of new projects."