Renewable Wind Energy Faces Challenges with Tax Hikes

Posted on Jan 29, 2012 in Energy Efficiency by Matthew Speer 0 Comments

The recent economic downturn has impacted the renewable energy industry, forcing companies like Solyndra to shut down or at least reduce their workforce. With only 10.5% of America’s energy being produced using renewable methods, any setback can be damaging to the industry as a whole. Wind energy is one of the fastest growing renewable energy industries, with companies investing billions in the U.S. to build out wind farms and production facilities. This growth has been helped by Congress with support of the renewable energy tax credit, though the tax break is set to expire at the end of this year. The political strife seen in Washington provides a level of uncertainty for renewable energy companies, leaving a reduced confidence that an extension will happen, which can lead to further job losses.

Economic Fears Come True if Tax Credits Expire

The fears are real considering that Vestas Wind Systems, one of the world’s largest wind turbine manufacturers, announced it was cutting 2,335 workers, according to a Huffington Post report. Vestas also warned that an additional 1,600 layoffs could occur in the U.S. if Congress does not extend renewable energy tax breaks. In that same report, Denise Bode, chief executive of the American Wind Energy Association, noted that the cuts being made by Vestas does show the danger to U.S. manufacturing if the tax credits are not extended.

Ambitious Renewable Energy Goals At Stake

The tax credit woes come after President Obama’s bold ambitions to transition America’s energy consumption to 80% renewable or clean energy by 2035. China’s Goldwind and Ireland’s Mainsteam renewable power companies plan to break ground on a $200 million build out of a wind farm in Illinois. Additionally, local politicians in Montana are wooing Goldwind to build a 20-megawatt facility in the middle of the state. There is no doubt that the renewable energy sector could lead us into an economic boom as countries across the world work to go green and lessen their dependence on fossil fuels. Sen. Jeff Bingham’s view that “…the type of short-term extensions Congress is prone to passing puts American jobs in jeopardy,” is shared among eco-conscious advocates. We must point out the irony that the Congress still has yet to take action on subsidies for oil companies, which just a portion of that money could fund the tax credits at risk.

Don’t Just Read About It – Do Something

Instead of complaining about the lack of funding and inaction by our elected officials, we chose to ask our readers to step into action. It is clear that in an election cycle politicians listen, therefore we ask that each of you reach out to your local Congressional representative and ask them to support the long term extension of the renewable energy tax credit. This will help reward companies investing in clean energy and get the industry flourishing. The expectation is not to fund the industry, it has to stand on its own two feet, though a gentle nudge in the right direction is something we can all stand behind.