Wind Energy Tax-Credit Extension

Fri, 2013-01-04 11:58

After weeks of deliberation, Congress brokered a deal to avert the fiscal cliff, significantly impacting the renewable energy industry. In particular, the deal allows for the extension of the Production Tax Credit (PTC) and the Investment Tax Credit (ITC), which will help further the development of American wind energy resources.

The tax-credit extensions will:

• Provide tax relief to U.S. wind farms that begin construction in 2013

• Support the manufacturing of wind turbines and components in America

• Sustain growth in the industry, and;

• Promote offshore and community wind as well as land-based projects

The uncertainty surrounding the tax-credit extensions created havoc in the U.S. wind industry, resulting in the layoff of thousands of workers and halting new projects at manufacturing plants. While the tax extension will alleviate many of the concerns about wind development growth this year, there is still the problem of momentum loss, which will resonate throughout 2013.

Fortunately, the tax credit gives manufacturers and wind farm developers time to recuperate, as it applies to any wind development project that begins construction efforts in 2013. On average, it takes 18 to 24 months to develop wind farms and the tax credit will apply to all 2013 developments, even if estimated completion is one-to-two years out.

Additionally, the American Wind Energy Association estimates that the tax-credit extension will save up to 37,000 jobs that were threatened by the potential fiscal cliff fallout. The wind energy sector has grown substantially over the last decade both in production and employment across the U.S., particularly in Texas, California, and Iowa. In fact, according to the Energy Information Association, wind energy installations set a record last year, representing 44 percent of all-new electrical generating capacity in the U.S. Most importantly, however, are plans to phase-out reliance on tax-production credits, as the extension only applies to this year. The American Wind Energy Association (AWEA) proposed a six-year plan, which while meeting criticism from some wind developers, is projected to improve the forecast for future wind development projects. “We’ve always said we won’t need (the production tax credit) forever,” said Ellen Cary, a spokeswoman for AWEA. “We need to have a glide-path to keep the success.”

While uncertainty in the industry still remains for some individuals and developers, the immediate future looks promising and wind development projects will continue to arise throughout 2013 and beyond. If you’re looking to break into the wind energy industry, consider taking Everblue’s introductory Basics of Wind course, which is currently priced at $99 and provides the basis for career-related aspirations. For more information, call us at 800-460-2575 or send an email to

By Peter J. Bock

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