US wind industry receive tax credit boost
A tax credit for companies producing wind-generated electricity will be reinstated in 2005 and is expected to support the development of around US$3 billion worth of wind power projects.Extending the Production Tax Credit (PTC), which had expired in 2003, will add around 2,000 MW in capacity - the equivalent of powering around half a million homes, according to the American Wind Energy Association (AWEA).
The scheme will give energy companies a 1.8 cent tax credit for every kilowatt-hour of electricity that they produce. One kilowatt-hour will power a 50-watt light bulb for around 20 hours.
Deputy AWEA Executive, Tom Gray, warmly welcomed the wind energy PTC's return: "This action by Congress means wind energy investments forecast over the next several years are now back on track across the country."
He added that hundreds of furloughed wind industry employees would now go back to work, building and installing wind turbines.
The AWEA is to request a long-term PTC extension from Congress, along with a renewable portfolio standard (RPS). Mr Gray stated that this would move the industry away from the "boom and bust" cycles of the past, which he says were caused by short-term extension policies.
"We strongly believe wind energy can provide 6% of US electricity by the year 2020, or at least as much electricity as hydropower generates today," he said. "This action allows us to work towards that goal."
Congress has already passed the PTC, and President Bush is expected to sign the legislation to law soon.
By Jane Kettle