Wind energy tax credits in for a rough ride

November 21, 2014 | By Doug Peeples

The news reports and speculation over what Congress will do with federal wind energy tax credits when Republicans control both the House and Senate come January are numerous. The biggest backers of the wind industry tax credit program are not expected to have as much pull as they did, which could mean a questionable future for the industry.

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But it is not simply the federal credits that are under the microscope. A report from the Texas comptroller's office describes the state's tax credit program for wind energy as a liability, for the state and its taxpayers.

The irony is that Texas is the nation's leader in wind energy production with about 8,000 wind turbines providing 12,755 megawatts of installed capacity and more on the way, according to a report from the American Wind Energy Association.

It would cost about $13 billion to extend the federal tax credit for 2015, and a Republican-controlled Congress is expected to look at many other tax breaks.

"Let's just leave this one out. It seems hard for me to imagine that Senator Reid would hold up an important package of tax provisions in order to do a small favor for some of his friends in the wind industry," Representative Mike Pompeo (R-KS) was quoted as saying in Bloomberg.

Debates in Congress are sure to be heated, and they are expected to be in Texas, too. While Susan Combs, the state's comptroller, said the state's tax credits and property tax breaks for new wind farms were helpful in getting the industry on its feet, but now "…give it an unfair advantage over other power sources," according to a New York Times article.

Texas wind energy is not the only industry in for scrutiny. The comptroller's office is also expected to issue a report soon on the state's incentives for the natural gas industry.

One specific element of the natural gas incentives likely to be debated is that they were substantially expanded, for the most part because of the growth of hydraulic fracturing -- which is an expensive process.

For more:
- see this report

http://www.fierceenergy.com/story/wind-energy-tax-credits-rough-ride/2014-11-21