Empowering Communities, Advocating Solutions

The Uncertain Future of Domestic Wind


Extension of the Production Tax Credit (PTC) for wind energy is important to the future of the wind industry in America, including potential projects offshore of Long Island. The PTC is a key federal tax incentive that has helped to build a strong wind industry in the United States. The credit works by providing wind farm owners 2.2 cents per kilowatt-hour of power produced over a ten-year period. It was set to expire at the end of 2012. Instead, as part of the ‘fiscal cliff’ deal, congress has approved a one-year extension of the PTC, allowing developers to claim the tax credit as long as they begin production before the end of 2013. Although this is a step in the right direction, the one-year extension falls short. While the PTC has been effective, it must be extended further into the future to provide the wind industry with the  support to invest in cost-saving technology that will allow the wind energy to thrive in the U.S.

As long as we continue to subsidize the oil and gas industry—industries that are certainly not hurting for profits—wind energy will be put at a disadvantage. The fiscal cliff deal left oil and gas tax breaks untouched, despite the fact that trimming even a small amount of tax subsidies for dirty energy would generate billions of dollars in revenue over the next decade. Instead, we need to encourage development of renewable energy sources. The extension of the PTC past 2013 is crucial to the future of America’s domestic wind industry—a key alternative to oil and gas.

In the wake of Superstorm Sandy, Long Island is faced with the task of rebuilding. The silver lining here is that we have the chance to rebuild in a smarter, more sustainable manner. After the nuclear disaster at Fukushima in March 2011, Japan shut down all 54 of its nuclear reactors. They have since reopened two facilities in response to energy shortages. However, Japan has also developed a longer-term plan to increase its renewable energy resources; construction of what will be the world’s largest offshore wind farm off the Fukushima coast will begin this July. The wind farm will produce 1 GW of power once it is completed in 2020—that’s twice the amount of energy produced by the largest wind farm operating at present.

Superstorm Sandy, like the Fukushima disaster, highlights the vulnerability that comes with relying heavily on one particular source of energy. In the weeks after Sandy, Long Islanders felt the crunch of the gas shortage. Our geographic isolation illustrates the fact that there are few resources being generated locally. Regardless of one’s stance on the effectiveness of gas, oil, nuclear, or renewable energy, the common ground is that diversifying our sources of energy will create greater stability for the future. With miles and miles of coast, Long Island should invest aggressively in offshore wind farms. Unfortunately, with no plans yet in place, it is unlikely that this will happen if the PTC is allowed to expire in 2013.

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