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Yesterday the Senate Finance Committee passed the Family and Business Tax Cut Certainty Act of 2012. Included in the Chairman’s mark are proposals to extend the Production Tax Credit (PTC). Under current law, taxpayers can claim a 2.2 cent per kilowatt hour tax credit for wind electricity produced for a 10-year period. This proposal would extend the PTC for another year allowing renewable energy facilities that begin construction before the end of 2013 to claim the 10-year credit.
The Committee’s proposal also included an immediate 30 percent investment tax credit for facilities that produce electricity from wind over a ten-year period.
The Senate Finance Committee passed the PTC extension package 19 to 5. All 5 opponents were republicans including senators Burr (NC), Coburn (OK), Cornyn (TX), Enzi (WY) and Kyle (AZ). Senator Tom Coburn offered an amendment to reduce the PTC by 20%, but it failed on a 9 to 15 vote.
Republican Senator Chuck Grassley from Iowa voted to extend the PTC and voted against Coburn’s reasonable amendment. Crony capitalism seems not to bother Senator Grassley when it is beneficially to his own state. The PTC extension will be voted on by the Senate as a whole sometime after September and if passed, will move on to the House where it has its best chance of being voted down.
These Senate Committee proposals are estimated to cost taxpayers over $12 billion within the next 10 years. Multiple billions of dollars have already been spent on the wind industry for over two decades now, yet the wind industry still accounts for only 2 percent of our national energy consumed.
The central purpose of this wind tax credit expansion is to provide certainty for wind industry investment. But this supposed ‘tax cut certainty act’ doesn’t really provide the wind industry with certainty because the expansion only lasts one year.
Tell your Senator to let the Production Tax Credit (PTC) expire. The federal government should not be in the business of picking winners and losers in the energy market, nor should it steer investment toward particular politically favored states. Crony capitalism is bad for American businesses and hardworking American taxpayers.