Asserting that hundreds of thousands of job losses are at stake, leaders of four major US renewable energy trade associations have called on Congress and President Bush to extend production and investment tax credits to sustain hard-fought gains in cleaner electric generation...
By Jim Pierobon
Several of the largest renewable energy organisations in the US have recently joined forces - calling on Congress and President Bush to continue support for clean electricity generation.
"Already, we are seeing sales and new project announcements drop off," the Associations declared in a statement issued jointly by the American Wind Energy Association, Solar Energy Industries Association, National Hydropower Association and the Geothermal Energy Association at a recent news conference in Washington.
Such joint announcements are rare but the absence of the extensions in the energy legislation signed into law in December 2007 has compelled them to make a collective appeal to lawmakers and the White House.
"With the national facing a possible recession, it is difficult to imagine a worse time to destabilize America’s rapidly growing renewable energy sector. If the renewable energy tax credits are allowed to expire, we will lose hundreds of thousands of jobs here in the US" the statement said.
Amid a reduction of .75% in the US discount rate to 3.25% and a declaration by Treasury Secretary Henry Paulsen that an economic stimulus package needs to be simple and short-term, the call for long-term extensions in the tax credits will likely be a tough sell for renewable energy advocates.
Rhone Resch, President of the Solar Energy Industries Association, tried simplifying it for lawmakers: "Do you want to write them (consumers) a check, or do you want to give them a job?"
Resch highlighted 80 utility-scale solar projects on the drawing boards collectively representing about 56,000 megawatts of electric generating capacity, more than 20,000 permanent jobs and hundreds of thousands of construction jobs. "None of these projects will be built unless the investment tax credit is extended," he said.
Randall Swisher, Executive Director of the American Wind Energy Association, said "major wind farm development companies are telling us that investment is drying up and they are being forced to put large projects in the pipeline for construction next year on hold."
Swisher told reporters that AWEA estimates that about 75,000 jobs are now at risk, including more than 32,000 in the direct manufacture, construction and operation of wind energy facilities.
During the buildup to passage of the new energy law last summer and a companion tax bill, it once appeared that production tax credit for wind and investment tax credit for solar would find a way into a compromise. But both ended up on the cutting room floor in December. Whether 2008 is different depends on numerous factors, not the least of which the U.S. is in the thick of nominating candidates to be the next President.
"The reason we were not in the energy bill at the end of the day had nothing to do with any lack of support for solar, or for wind, geothermal or hydro," said Resch. "It had to do for how that tax title was structured."
"When you start to look at how is this going to get done, the answer really becomes, it’s a matter of politics and making sure that the bills that are put forth are going to get through this year," Resch said. "We’re very hopeful that as leadership starts to structure both an economic stimulus bill or perhaps an energy tax title, they’ll do it in a way that passes these tax credits early in the first quarter and not wait until late in the year."
Linda Church Ciocci, Executive Director of the National Hydropower Association, said "if there is a better way or another way of doing it quickly (other than a stimulus package), we’re certainly open to that."
Karl Gawell, Executive Director of the Geothermal Energy Association, said geothermal plants take between three years and five years to develop. He said projects that are already under construction may get finished, "but the guy who’s deciding today whether to start construction in February or March is looking at the deadline looming at the end of the year because it’s going to take him two years or two and one-half years to finally get that project online."
Gawell counted 86 geothermal projects under development that are at risk in more than 12 states, representing 3,300 megawatts. That would more than double the industry’s current electric generating capacity.
What are the credits in question?
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