PTC opponents unveil study, ad campaign

Source: Nick Juliano, E&E reporter • Posted: Tuesday, December 3, 2013

Opponents of an expiring renewable energy tax credit are rolling out a new study and ad campaign today arguing that some states receive more benefits than others.

It’s the latest move in a long-running effort by the American Energy Alliance, a conservative advocacy group, and the Institute for Energy Research, its affiliated think tank, to eliminate the production tax credit, which supports the generation of wind electricity and a handful of other renewable sources. The credit is set to expire at the end of this year, although a modification enacted in January means wind developers can continue to claim it through at least 2015 as long as certain conditions are met.

The IER study calculates how much wind developers in each state received last year from the PTC compared to their taxpayers’ share of the cost to provide the credit, which was $22 per megawatt-hour at the time (that figure increased to $23/MWh this year to adjust for inflation). It found that 30 states paid more than was recouped via in-state generation, led by California, New York, Florida, New Jersey and Ohio. The leading winner was Texas, which received a net benefit of about $400 million, followed by Iowa, Oklahoma and North Dakota.

In general, PTC beneficiaries were clustered in the windy corridor in the center of the country from the Texas Panhandle north to the Canadian border, along with the Pacific Northwest, Maine and a few others. The Southeast, which hosts virtually no wind energy generation, was the region that paid the most for the credit.

“Studies like this are essential for the American public to understand what happens when government takes their money to fund expensive programs that benefit boutique industries,” said Chris Warren, a spokesman for AEA.

“We will be making an aggressive push to help policymakers understand the real-world impacts of wind subsidies on their constituents.”

Accompanying the study, AEA is spending $30,000 to $40,000 to run print and online ads in several publications, including The Weekly Standard, The Washington Examiner and National Journal.

The state discrepancies provide an entry for AEA’s lobbying against the PTC to target senators and House lawmakers from payer states. Aides to some of those members are receiving emailed copies of the study this morning under the subject line, “Do you work for a loser?”

Winning an extension of the PTC remains a top priority for the wind industry and its allies in the environmental movement, although most observers acknowledge nothing is likely to happen before the credit expires Dec. 31. Industry supporters are primarily focusing on the evolving negotiations over comprehensive tax reform, although they may shift to lobbying for another short-term renewal as part of a narrower “tax extenders” package before the end of next year if the comprehensive talks falter.

The American Wind Energy Association, the industry’s main lobby group, greeted the study by pointing to the industry’s broader benefits.