SOUTH FREEPORT — As winter approaches, Congress is being overrun by wind industry lobbyists (again). Their annual year-end money dance has become routine as we have seen the 1992 energy production tax credit die more deaths than the proverbial nine-lived cat.

Just as routinely, we have become accustomed to picking up the newspaper on New Year’s Day to read that in the cold, dark holiday night, Congress has revived the production tax credit (again).

Over time, most of Maine’s congressional delegation has supported throwing additional taxpayer money at the expired or expiring production tax credit, often at the eleventh hour. It stands to reason that aggressive wind developers in Maine have influenced the Maine delegation’s decision to support the production tax credit.

“Subsidy” is a lightning rod word. But subsidies can be justified when they contribute to the public good. In the general public, wind energy’s positive benefits are regularly overstated, while conversely, wind’s negative impacts are understated. Because of this flawed value equation, wind energy has enjoyed the public’s favor and gratuitous federal subsidy dollars (in addition to state mandates).

For the sake of Maine’s environment and economy, it is time for Congress to finally let the production tax credit subsidy die. The Maine delegation can help make this happen by ending its historic support.

Maine’s wind energy buildup in the last decade has been dominated by one developer: First Wind (now SunEdison). In a 2012 Recharge News article, “First Wind chief executive says life without PTC is possible,” First Wind CEO Paul Gaynor discussed the production tax credit:

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“I know the industry has needed it. I think the question for all of us is, ‘Do we need it any more or forever?’ I believe the answer is no.”

In a Bloomberg News article, “U.S. tax breaks that clean power doesn’t seem to mind losing,” Ahmad Chatila, CEO of SunEdison (which is now in financial difficulty), discussed the production tax credit just a few weeks ago:

“If the (production tax credit) expires we will be fine, we can get by.”

The wind production tax credit expired (again) in December 2014. Because the wind lobby inserted a “begin construction/safe harbor” provision into the law, and thanks to loose Internal Revenue Service rules that allow it, wind projects we don’t even know about yet can still sneak in as production tax credit-eligible even if they have not turned a shovelful of dirt. The wind industry is losing its window for starting projects, so the wind lobby is back in holiday mode, applying pressure in Congress (again).

Last summer, the Senate Finance Committee voted out a $95 billion tax extender bill that included a two-year extension of the wind production tax credit (2015-2016). The production tax credit was the third most expensive provision in the bill at $10.5 billion.

In October, U.S. Sen. James Lankford, R-Okla., submitted a bill to end the wind production tax credit. In the House, the Production Tax Credit Elimination Act offered by U.S. Reps. Kenny Marchant, R-Texas, and Mike Pompeo, R-Kan., is still pending, and new co-sponsors have signed on every month since the bill was introduced.

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We might see action on the production tax credit by year’s end, and it won’t be a surprise if votes finally occur while the rest of the country is sipping eggnog at holiday parties (again).

The wasteful production tax credit has become politically toxic, gaining the nickname “wind welfare.” We cannot afford more billions to spur the growth of a mature industry that does little good.

With the Department of Energy and the American Wind Energy Association regularly crowing that wind is cost-competitive with (or more competitive than) conventional generation sources, there is no justification for further subsidies. The wind training wheels have been on the bike since 1992. They have done their job and it is now time to remove them.

The production tax credit has rarely been considered in the House or Senate as a stand-alone vote. The last time was 2012, in New Jersey Democratic Sen. Bob Menendez’s amendment to the transportation bill. It failed.

If the Senate and House consider the wind production tax credit in the eleventh hour (again) this year, it must be as a stand-alone vote in each chamber. That way, the wind lobby cannot gain a free ride by attaching to the more beneficial tax credits seen as “must pass.”

If Maine’s wind development leaders are telling us they don’t need all that production tax credit money, then why would the Maine delegation throw it at them (again)?

— Special to the Press Herald


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