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Published on July 24th, 2012 | by Stephen Lacey


Romney Would End Wind Energy Production Tax Credit (Costing US 37,000 Jobs)

July 24th, 2012 by  

Staffers for Mitt Romney’s presidential campaign say the candidate wants to end the wind production tax credit.

That federal credit has allowed the wind industry to compete with heavily-subsidized fossil fuels that do considerable harm to the environment and public health — impacts that are not reflected in their price.

The production tax credit provides wind developers with a tax benefit of 2.2 cents for every kilowatt-hour of wind electricity produced — far below the air pollution damages caused by coal plants. Without Congressional action, the incentive will expire at the end of this year, potentially resulting in the loss of tens of thousands of manufacturing and construction jobs supported by the sector.

Romney has hinted that he wants to end federal tax support for clean energy, but he has not yet made a definitive statement on the production tax credit. However, the Des Moines Register is now reporting that Romney has taken a more concrete stance on the issue:

Mitt Romney’s opposition to wind power could put a damper on Iowa’s wind industry and its thousands of jobs, advocates say.

The federal wind energy production tax credit is set to expire at the end of the year. Staffers for Romney, the likely Republican presidential candidate, said he wants to end the credit, but didn’t specify whether it should be allowed to expire this year or phased out shortly after. President Barack Obama wants an indefinite extension of the tax credit.

Industry insiders and policymakers in Iowa, Republicans and Democrats alike, say ending the credit would hurt Iowa’s blossoming industry.

“It’s really going to slow down the expansion of wind energy,” said Harold Prior, executive director of the Iowa Wind Energy Association. “This could mean the loss of several thousand jobs in the industry.”

The looming threat of an expiration is making it difficult for developers to plan beyond 2012. As a result, wind companies are delaying projects and laying workers off. In Pennsylvania, a turbine manufacturer furloughed 165 workers; in April, an Ohio wind developer scrapped plansfor a $20 million project; in Arkansas, Mitsubishi Heavy Industries halted plans for a $100 million production facility; and Vestas, the world’s largest wind manufacturer, may lay off 1,600 workers if the credit expires.

As the Des Moines Register reports, federal policy uncertainty is forcing companies to move activity outside the American market:

One company said the uncertainty over the tax credit’s future has led leaders to focus on exporting its products to other countries instead of banking on domestic buyers. Spain-based Acciona has been assembling wind turbines in West Branch since 2007.

“What we are doing in West Branch is diversifying our portfolio, not just focusing on the United States, but Mexico and Canada as well,” said Joe Baker, chief executive officer of Acciona’s North American windpower unit.

“The uncertainty prevents the investors from committing resources to new wind farms and really creates about an 18-month gap, even if the production tax credit is renewed. Our association has had some companies that have gone out of business because of the uncertainty. They don’t know if they can sustain their operation,” Prior said.

Over the last five years, wind has brought $20 billion in annual private investment to the U.S. — helping support 75,000 jobs and making America one of the most competitive countries in the wind industry. However, the expiration of the credit may force up to 37,000 layoffs in the industry over the next year.

While he supports ending federal support for the wind industry, Romney has fiercely defended tax credits for the mature oil and gas industries.

The Obama campaign has seized on Romney’s contradictory stance in recent months, using it as a messaging platform in the Midwest, where wind provides enormous economic benefits.

“You had our good friend Mitt Romney saying he dismissed wind and solar by saying they’re ‘two of the most ballyhooed forms of alternative energy.’ Tell that to the 7,000 workers manufacturing wind power here in Iowa,” said Vice President Joe Biden at a campaign stop in Iowa.

This article was originally published on Climate Progress. It has been reposted with full permission.

Image: Mitt Romney via Maria Dryfhout / Shutterstock.com

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About the Author

is an editor at Greentech Media. Formerly, he was a reporter/blogger for Climate Progress, where he wrote about clean energy policy, technologies, and finance. Before joining CP, he was an editor/producer with RenewableEnergyWorld.com. He received his B.A. in journalism from Franklin Pierce University.

  • I plan to get a job in the wind industry but i think that to get a bill past the tea party republicans than we need to get over an indifinate extension and move to like a 10 year decreasing credit, start at 2.2 per kwh and next year go to 2 than 1.8 and so on and so forth so that it will get people to invest as quick as possible

    • Ross

      The carbon tax could be ramped up over a decade as well.

      • Bob_Wallace

        I really don’t think wind needs ten years of further support. Solar might need that much, but could perhaps get by with a bit less.

        Seems to me it’s more about how the industries get jerked around with the uncertainty created by some members of Congress. It’s not the way one who cares about American business and American workers should do their job.
        Fossil fuels clearly don’t need subsidies. They are massively profitable and mature industries.

        Just set up a “ten” year plan. A the end of the term subsidies for all would be gone.

        Leave room for subsidies for new emerging technologies such as tidal, wave, battery storage.

  • Rick

    You just can’t stop making clean energy about politics.  OK, Economics 101:  When you take a few billion dollars out of the private sector, in the form of taxes, and give it to someone who wants to build a wind farm you have not created any net jobs. You are assuming that those dollars are better spent by the government than by the person or corporation that earned them.  Not so, yet again and again you make this assertion.   And yes, I know you’re going to cover your ears and shout “La La La I can’t hear you” if I say Solyndra. 

    There are a lot of us who believe in smaller government AND clean energy.  Once this government has managed to destroy private sector initiative with high taxes and deficit spending there will be little left to invest in the clean energy that most of us do want.

    You do an excellent job of finding and pointing out the success stories in in clean energy.  I believe that you are advancing the cause of clean energy in this way.  However, if you turn off your conservative or libertarian readers  with your pro-Obama bent you only harm that cause.

    • Dimitar Mirchev


      The problem is not the support or lack of support for Clean energy.The problem is (and your post clearly proves it) that we talk about support or lack of support ***ONLY*** for Clean Energy.

      Romney Would End Wind Energy Production Tax Credit [ but will keep all the tax breaks and support for nuclear and fossils. ]

      You dont want support for clean energy yet not a word about the support for nuclear and fossils.

      And YES – Clean Energy will eventually become competitive with subsidized nuclear and subsidized fossils who by the way have huge externalities. Even if USA cuts all the support for Clean Energy.

      But it will take 10-15 year longer than EU, China, Japan etc. 

    • kjw

      Rick- are you also against subsidies to the oil/coal industries? I always hear criticism of renewable tax credits by the conservative /libertarians but i almost NEVER hear any criticism of the much larger subsidies to the oil/fossil fuel companies which eclipse those of the renewables sector. Just saying …. 

      • Rick

         Yes, I am against subsidies for oil, gas and nuclear industries as well.  But, please keep in mind that we are comparing a reduction in the taxes a company pays in the form of depletion allowances etc. with money going from tax payers in support of a specific industry or company. IMO, a reduction in tax rates is not the same as a taxpayer funded subsidy.   (Allowing me to keep more of what I have earned is not the same as sending you a check)

        When we start to pick the winners, we also pick losers as they are the companies who got no subsidies but still need to compete with those who did. 

        All that said, many of us would agree that the PTC has had some positive effects on the growth of the wind and solar industries.  We cheer the advance of alternatives displacing coal and, to a lesser extent gas and petroleum.  

        The way I see it, when you attack conservatives / libertarians you drive those of us who value energy independence as well as fiscal responsibility to ally with oil companies instead of clean energy.  The blatant politics does you a disservice. 

        • kjw

          While I commend your personal view of not wanting to support oil, gas, nuclear etc subsidies I am a little puzzled by your last comment. By aligning with oil companies simply because you feel bad about a perceived attack on conservative/libertarian points of view don’t you see that this runs contrary to your mantra of not picking winners and losers and letting the free market choose? Oil and nuclear are heavily subsidized to the point that oil, coal nuclear are much cheaper than they would be otherwise. How can cleaner more sustainable fuels compete with half a century of subsidies?  Whether you want to call it a tax cut or govt backed loan or a direct giveaway the subsidies to fossil fuels are there. I would love to see more conservatives/libertarians in office choose to end support for those subsidies to level the playing field but, correct me if I’m wrong, I’ve just never seen it happen.

          Healthcare and environment not included here are some examples of subsidies to those industries mentioned: Nuclear:to put hints in perspective according to Grist : ” $95 billion (in 2011 dollars) on nuclear energy R&D. That is more than four times the amount spent on solar, wind, geothermal, biomass, biofuels, and hydropower combined.”  http://grist.org/nuclear/stop-the-nuclear-industry-welfare-program/Coal: 17 billion in subsidies – credit to think progressCredit for Production of Nonconventional Fuels ($14,097)- IRC Section 45KCharacterizing Coal Royalty Payments as Capital Gains ($986) – IRC Section 631(c)Exclusion of Benefit Payments to Disabled Miners ($438) – 30 U.S.C. 922(c). Other-Fuel Excess of Percentage over Cost Depletion ($323)Credit for Clean Coal Investment ($186)Special Rules for Mining Reclamation Reserves ($159)84-month Amortization Period for Coal Pollution Control ($102)– IRC Section 169(d)(5)Expensing Advanced Mine Safety Equipment ($32) – IRC Section 179EBlack Lung Disability Trust Fund ($1,035)Oil: hundreds of billion (don’t have an exact figure)These subsidies are generally provided through our tax code but they are basically no different than govt spending programs that provide money directly. If you preferentially reduce taxes for big oil by giving them a much lower rate it adds a burden to other other businesses that are taxed at a much higher rate. The govt is still going to spend was it is committed to spending to run this country and that $$ has to come from somewhere. Oil was making record profits at $55 a barrel and got those tax incentive then. Why should they get them now when the price is  close to $90. “According to the most recent study by the Congressional Budget Office, released in 2005, capital investments like oil field leases and drilling equipment are taxed at an effective rate of 9 percent, significantly lower than the overall rate of 25 percent for businesses in general and lower than virtually any other industry.”

    • Bob_Wallace

      Rick, your claims are just absurd.

      There is little in your life in which the government and taxpayer money did not play a major creative role.

      Start with the computer on which you type your claims, add in the internet, then the grid from which you get the power, then the railroads which haul the coal that supplies some of that electricity and the dams which supply some.  The list goes on….

      The government, we the citizens, constantly help new business activity emerge.

      Conservatives and libertarians need to take a long, hard look at the talking points they’ve been told to use.  Stopping government assistance to emerging industries helps only one group of people –  those in other countries.

      If we stop supporting emerging industries we hurt America.

      Can you wrap your head around that?

    • Ross

      Rick – what’s your position on Bob Inglis’s proposal that green subsidies are removed and in return fossil fuels bear the costs of bad health due to pollution, global warming mitigation/adaptation/abatement and war to protect oil fields?

      Following the logic of your economics 101 such a deal would see resources flow into renewable energy and reduce the costs of dealing with the problems caused by fossil fuels (and nuclear power). 

    • Rick, i understand the ideological ideal.

      BUT, if you want clean energy to be on equal footing with fossil fuels and if you want climate change to be addressed, national-level GOPers are simply the last thing you should be supporting. They have demonstrated time and time again that they will keep or increase subsidies for over-mature energy industries and kill those for clean energy.

      I have no political allegiance, but i do have an allegiance to doing everything i can to protect the human species (and over 50% of the species on this planet) from total collapse and extinction. And the fact of the matter is, current GOP leadership is wholeheartedly against this (due, without doubt, to its strong ties to fossil fuel industries).

      And, to separate energy from policy & politics is just an irresponsible thing to do, in my opinion. Energy is very heavily influenced by policy and politics. And will be for as long as one can see. Helping to deliver the Dirty Energy Squad a loss is a key need for advancing clean energy and other cleantech.

      If clean energy and dirty energy were actually on equal footing, i’d be all for letting society decide. But that’s simply not the case. Dirty energy has had over a century of government support that dwarfs clean energy support, and externalities alone dwarf clean energy support, yet one party has essentially signed a blood pact to do everything in their power to kill clean energy support. It’s sad.

      I wish i never had to write a post on politics in my life. But that’s not the case if i want to do my job adequately.

    • SLS41

      I’m stuck on the sentence “you just can’t stop making clean energy about politics”…..are you new to this industry? This planet? Um…wow, where to even begin with that level of naivete. If clean energy had no political barriers we would not be reading this article…it would not need to be written. 

      • Bob_Wallace

        Furthermore, if the fossil fuel industry wasn’t using politics to slow the growth of renewables we’d be past the critical point in preventing climate change. Or at least be very much closer to that point.

        Ask yourself, why should the right wing be opposed to cleaner, cheaper electricity?

        Why should the right wing be against electric cars when they will save us huge amounts of money and lower our national insecurities?

        Shouldn’t fiscally conservative people who put national security high on their priority list be pushing for cheaper, locally made energy?

        • And if energy is highly influenced by politics, isn’t it the old, long-subsidized, and extremely rich fossil fuel industries that have the unfair upper hand?

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