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Congress Should Extend Clean Energy Tax Credit

Congress Should Extend Clean Energy Tax Credit

Note: This is a guest post from Phyllis Cuttino, director of Pew’s Clean Energy Program.

In 2011, for the first time in several years, the United States led the world by investing more than $48 billion in clean energy. The clean energy sector represents one of the fastest-growing industries globally, with investment increasing more than 600 percent between 2004 and 2011 (excluding research and development).

We’re in danger of losing our place at the top, however. To maintain our lead amid fierce international competition and to continue to attract private capital, there must be policy certainty. While other nations have national policies to encourage the adoption of clean energy, we rely on a patchwork of state policies and cyclical federal tax incentives, one of the most important of which is to end in a year.

The production tax credit (PTC) is an effective tool to keep electricity prices low and encourage the development of proven clean energy projects. While not large — about 2.2 cents per kilowatt hour — it gives American businesses the certainty they need to continue to invest, build and deploy. But it’s set to expire at the end of 2013. Uncertainty about whether Congress will act to extend the PTC has already resulted in a sharp drop in investments in wind energy production, threatening the livelihoods of the more than 78,000 people nationwide who are in wind-supported jobs.

When Congress has allowed the PTC to expire in the past, wind installations declined by 73 to 93 percent. According to a December 2011 study by Navigant, a global consulting firm known for its expertise in energy issues, 37,000 wind-supported jobs would be lost if the PTC was not extended before 2013. Congress should enact a multiyear extension of this incentive, which provides certainty to the industry and would ensure the continued growth of renewable energy industries. Our country leads the world in clean energy venture capital investment, but without such strong policy commitments to clean energy as the PTC, it will be challenging to scale up new innovations. If demand for these modern technologies is not created in the United States, development of the clean energy industry will suffer.

There is no lack of political support. Karl Rove, who was a senior advisor to President George W. Bush, raised eyebrows recently when he joined with Robert Gibbs, who served as President Barack Obama’s press secretary, to publicly support congressional action to extend financial incentives for development of wind energy. In endorsing the policy, Rove said, “My hope is that after the election, people say, look, let’s start making some priorities, and find some things that we can agree on, and maybe one of them is the production tax credit.” If political party operatives such as Rove and Gibbs, Republican and Democratic governors, and the Sierra Club can agree to extend this policy, Washington lawmakers from both sides of the aisle would be able to do so as well.

Policy matters. Nations that have strong policy commitments to clean energy already reap the economic rewards. If the United States is to effectively compete in the global clean energy race, Congress should extend the PTC.

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44 comments

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5:38AM PDT on Sep 5, 2012

So, for our $48 billion, we got how many jobs? Almost none! In fact, several of the companies who received stimulus money have gone bankrupt anyway!

2:46PM PDT on Sep 2, 2012

signed

9:44AM PDT on Sep 1, 2012

Rethugs kept the tax breaks on petroleum but removed tax credits on wind energy. These people are traitors to our country.

11:17PM PDT on Aug 30, 2012

deserves a pint..

6:28AM PDT on Aug 30, 2012

YES!!!!

6:16AM PDT on Aug 30, 2012

hopefully our congress people will remember that they represent us and not the power companies who make giant donations in the hope of influencing our representatives.
science has shown that renewable energy (wind and solar) are the best way t go both for the planet and us.

9:28PM PDT on Aug 29, 2012

@Dan B [Follow the science.]

Science is to republicans what garlic is to dracula , something to be avoided as it does not advance their existence.

Akin was a fine example (on the science committee even), expressing views on reproduction and rape that are so far afield of science as to disqualify him to be making any decisions at all regarding science.

Republicans and their supporters find science related to our environment to be the garlic to their vampire like corporate profits.

Republicans find the science of economics to be a dreadful inconvenience when having to sell the idea of tax breaks benefiting the very people who offshore the jobs and in so doing run up the deficit by offshoring the tax revenues of that employment.

Republicans get a rash from science

7:31PM PDT on Aug 29, 2012

Go wind and solar! The tax credits should continue for many years.

7:25PM PDT on Aug 29, 2012

I just want my friends to know that I've been Trying to send some messages to them, but for some reason I can't get the thing to work. Sorry.

3:41PM PDT on Aug 29, 2012

Follow the science.

Rmoney + Paul = of, by, and for the rich white men

The regressive Republican Party of No is obstructionist, mean-spirited, thuggish, religiously fanatical, scientifically ignorant, corrupt, hypocritical, untrustworthy, xenophobic, racist, sexist, homophobic, evolution and global warming denying, oily, anti-environment, anti-health, anti-consumer, anti-choice, anti-birth control, anti-education, anti-99%, union busting, Medicare mashing and Social Security slashing, fiscally irresponsible, misleading, authoritarian, selfish, greedy, out-of-touch, dishonest, lacking compassion, warmongering, and otherwise dangerous.

NEVER vote for Republicans.

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