Published on November 22nd, 2009 | by Susan Kraemer7
Recovery Act Incentivizes Portugal to Build $4 Billion Worth of New US Wind Power Projects
November 22nd, 2009 by Susan Kraemer
Through its Texas subsidiary Horizon Wind Energy, the giant Portuguese company EDP Renewables; the second largest wind company in the world, intends to almost triple its US projects to $4 billion worth of new wind energy projects in the United States through 2012.
This year alone Horizon Wind Energy installed $1.5 billion worth of wind power, adding 800 megawatts of clean energy to the grid to bring its US total to more than 2,500 MW in 21 states.
The CEO attributes the expansion to our new renewable energy incentives.
“EDP Renewables is serious about partnering with the United States for a number of reasons, but most of all because of the leadership we have seen from the federal government,” said Antonio Mexia, chief executive of EDP and chairman of EDP Renewables.
Current legislation does extend the investment tax credit (ITC) available to wind developers; till 2012. But uncertainty about passage of the on-again off-again ITC extension at the end of last year created a dive in wind projects into the first quarter of 2009. In the bailout bill last Fall it was extended (after eight attempts) at least long enough to prevent expiration until a more renewable-friendly administration would be sworn in.
In February the Obama administration not only extended the ITC till 2012, but also allowed wind developers to also benefit from a 30% production tax credit available to homeowners and businesses that encourages development of any form of renewable energy.
To help companies hard-hit by the downturn; the 30% tax credit legislation was modified under the Recovery Act to be made available as a cash grant within 60 days if a business had no profit to take a tax credit against.
There were no size limits on eligible businesses, only that it have no profits to take an investment tax credit against. An excel file listing ongoing awarded cash grants begins with an architectural office, that received almost $20,000 to put on a solar roof.
The cash grants, that began with these awards in September, also encourage investors by providing secure returns. For example, Texas-based JPM Capital is investing just over $101 million in a Horizon wind farm and will get paid back via cash grants that it expects to receive instead of tax credits. Like the rest of the wind sector Horizon was hit by the threatened ITC expiration last year.
The new legislation is also designed to encourage immediate reinvestment of renewable energy profits, so manufacturing for the nacelles, blades and other parts must be done here in the US to qualify.
Investment in wind power creates thousands of installation, maintenance and manufacturing jobs as well as some you might not have thought of like asking farmers if they want to host wind turbines.
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