Proponents of a tax incentive for new wind energy development gathered Thursday evening at the downtown campus of Montana State University Billings to endorse extending the wind production tax credit to the future of Montana’s wind industry.
Six panelists of the public forum discussed the importance of the tax credit renewal for wind developers to a room of about 60 people, emphasizing its significance to jump-start stalled wind development in Montana.
The corporate production tax credit provides developers a 10-year, 2.2-cent-per-kilowatt-hour tax credit on the production of electricity from utility scale wind farms. It is scheduled to expire Dec. 31.
Investors provide the capital needed to build a wind farm and in return get a tax credit on the energy produced once the farm is up and running.
Rep. Margie MacDonald, D-Billings, said if the credit is not renewed, Montana’s wind projects currently generating power are in jeopardy.
“The clock is ticking. It is imperative for Montana that this tax credit is renewed,” MacDonald said. “There is a lot at stake for Montana economically and environmentally.”
With the uncertainty of the tax credit's future, wind project developers are not making plans in the U.S. and American manufacturers are not receiving orders, panelists emphasized. They described a boom-bust cycle the industry has seen in previous years when the credit expired.
The tax credit has expired in 2000, 2002 and 2004. In the years after expiration, installations and jobs dropped precipitously.
“People need to know that all forms of energy are being subsidized in one form or another,” said Steve Tyrrel, president of Montana Wind Resources. “The wind industry is simply asking for the same economic support that other energy industries have enjoyed for decades.
“The wind PTC is a good policy to prime the pump of the domestic renewable energy industry. The initial support is repaid many times over in tax revenue from wind projects.”
In 2010, about $5.5 million in property taxes was paid to the state. Since then, seven new wind projects have been added, ballooning property tax amounts gathered by the state in 2012.
More than $1.6 billion of capital investment has been made in the state’s wind industry.
U.S. Sen. Max Baucus, D-Mont., released a statement saying the production tax credit has helped finance wind farms across central Montana, from Shelby to Judith Gap to Shawmut. Those wind farms have supported more than 1,500 jobs.
“Every day we delay extending the production tax credit is another day jobs like these are put on hold,” he said.
Sponsors of the public forum included Northern Plains Resource Council, Montana Conservation Voters Education Fund, City College at MSUB, Montana Wind Resources, Montana Renewable Northwest Project and Zephyr Wind.