Wind-farm jobs hinge on tax credit

Source: Joe Napsha • PITTSBURGH TRIBUNE-REVIEW • Posted: Tuesday, December 13, 2011

Pennsylvania’s chances to create thousands of jobs in the wind energy industry and get an economic boost from $1.5 billion in investments over the next four years could be reduced if Congress does not extend a tax credit that will expire at the end of 2012, wind power supporters said Monday.

If Congress fails to pass a four-year extension of a production tax credit, between 5,000 and 7,000 jobs that might be created during that period in Pennsylvania would be at risk, and wind-power investments worth between $1.25 billion to $1.5 billion in the state might not be made, according to a study released by the American Wind Energy Association, a Washington, D.C.-based trade group.

“Everybody is seeing the same thing. Everybody is working hard to fill orders for 2011 and 2012. There is nothing on order for 2013,” because of the uncertainty of the future of the tax credit, said David Rosenberg, spokesman for Gamesa Technology Corp. in Langhorne. The company has a plant in Ebensburg that builds windmill blades, and its Fairless Hills plant builds housings for a turbine’s main components, such as the controller, gearbox and generator.

The study prepared by Navigant Consulting Inc. of Chicago, did not predict how many of those Pennsylvania jobs would be lost if the tax credit extension were not passed, said Elizabeth Salerno, spokeswoman for the association.

The production tax credit gives companies that generate power from wind a 2.2-cent per kilowatt hour tax credit for the first 10 years of a wind farm’s operation. The tax credit gives companies an incentive to own windmill farms and sell the power to utilities. In addition to the tax credit, a Treasury Department grant program for the wind energy industry expires at the end of this year.

On a national scale, the study found that with the tax credit, the wind industry can create and save 54,000 American jobs in the next four years. That includes expanding the wind manufacturing sector by one third to 46,000 manufacturing jobs. Without the tax credit, jobs in the wind industry will be cut in half and there will be a one-third cut in American wind-manufacturing jobs, while private investment in the industry would drop by nearly two-thirds.

Pennsylvania’s windmill farms support 5,000 jobs, said Courtney Lane, senior energy policy analyst for Citizens for Pennsylvania’s Future. The state is home to 15 plants that manufacture components for the wind industry.

Duquesne University professor Kent Moors, an energy expert, said three or four years of continued subsidies for the wind energy industry will not be sufficient to put it on par with other energy sources.

“If people are looking for a ‘silver bullet’ in all of this, it doesn’t seem to be there. Wind’s ability to do it without government subsidies is extremely doubtful,” Moors said.