Renewable Energy | February 21, 2008 |
Wind Energy Needs Tax Credits
Wind has huge potential as a source of renewable energy, but it still accounts for barely 1 percent of the American energy supply. In 2006, however, wind power facilities totaling 2,500 megawatts were built nationally, making them the second largest source of new generating capacity in the United States. Senator Maria Cantwell of Washington is lobbying for the Pacific Northwest to get a bigger piece of that pie in the future.
"The opportunities for wind are limitless," said Cantwell. "It is really about how much we want to invest in this."
Cantwell was in the Port of Vancouver this week, explaining how she can help bring more wind power projects to the region. Extending a federal tax credit for wind energy farms is the first step, she said, because that will keep the investment community on board. The production tax credit, due to expire this year without congressional action, provides 1.8 cents for every kilowatt-hour of energy generated. That nudge is enough to entice investors to install wind towers rather than, say, natural gas or coal-fired power plants.
Cantwell's bid to include an extension of the production tax credit in the recent economic stimulus package fell short by one vote. The senator said she's planning to take another run at it, with the idea of using a two-year extension to shift the industry's growth into overdrive.
Washington only has to look a few thousand miles south to see the impact that wind power can have on a state’s energy usage. Wind power currently provides about 2 percent of the power consumed in Texas, but experts predict that by 2020 it will be about 20 percent. A new project underway in Pampa, Texas, should help the state reach that number.
T. Boone Pickens, who has a net worth of $2.5 billion and runs Mesa Power, is building a 4,000-megawatt wind energy facility in Pampa, which will cost as much as $10 billon. Construction is scheduled to begin in 2009, and the initial turbines will begin generating power in 2011.
As fossil fuel costs continue to rise, the prospects for more wind power projects across the country look good. Moreover, carbon taxes are likely around the corner, and wind power is a domestic resource with no fuel costs and no emissions issues. So what's not to like?


Comments By Readers
Hi Chris,
A few minor fact corrections on an excellent article:
1) New wind installations in the U.S. in 2007 actually totaled 5,244 megawatts (MW), rather than 2,500. The U.S. easily broke the previous single-country one-year record of 3,244, set by Germany in 2002. U.S. turbines will generate about 48 billion kilowatt-hours in 2008, or about as much electricity as the entire state of Oregon uses.
2) The tax credit is indexed to inflation and is now 2.0 cents/kWh.
3) In Texas this year, wind should produce about 4% of the state's electricity.
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