Wind-State Republicans in Tough Spot

Source: By Siobhan Hughes, Wall Street Journal • Posted: Thursday, August 2, 2012

Wind Turbines of Ohio LLC workers take down a wind turbine tower for repair at the KMC Sportsman Lodge in Gurnsey County, Ohio,  in March.

WASHINGTON–Mitt Romney‘s opposition to a $5.2 billion wind tax credit is roiling Capitol Hill, where wind-state Republicans are scrambling to figure out how to save the credit without exposing sharp differences with their party’s presidential candidate.

Republicans and Democrats had agreed to include the tax break, known as a production tax credit, in a package designed to extend expiring business tax breaks. But after Mr. Romney came out against the tax credit, Republicans were put in a tough spot. The result: The tax credit was omitted from a tax-extenders plan announced shortly after midnight that is to be voted on Thursday in the Senate Finance Committee.

By Wednesday, the fate of the wind tax credit was in flux. One possible scenario is that Senate Finance Committee Chairman Max Baucus (D., Mont.) could restore the tax credit on Thursday, when he unveils a modified version of the tax extenders package. “There might be a few modifications that I might offer at the markup as I’ll present a chairman’s modification,” Mr. Baucus told reporters. Asked whether that could include the wind tax credit, he said “it could include anything.”

Mr. Romney’s opposition has thrown Republicans into disarray. Sen. Charles Grassley (R., Iowa) and other wind-state Republicans are big supporters of the wind tax break, which has grown in popularity within the GOP as wind energy gains a toehold in many GOP leaning parts of the country.

Sen. Orrin Hatch (R., Utah) , the top Republican on the Senate Finance Committee, on Wednesday sought to tamp down the significance of Mr. Romney’s position, saying “”it’s just one of the things that is still a little cloudy in my mind as to where he really does stand on it.”

Mr. Hatch said he thinks that a phase-out of the tax credit–instead of outright elimination–”might be more consistent with Gov. Romney’s feelings anyway as he looks at it thoroughly.” Mr. Hatch said he expects to talk with Mr. Romney about it.