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Free-market coalition urges Congress to oppose wind tax credit

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Michael Bastasch Energy Editor
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A group of six free market organizations sent a letter to 158 members of Congress today, urging them to allow the wind production tax credit (PTC) to expire at the end of this year.

The letter targets members of Congress who represent 21 states without renewable energy mandates and are unlikely to receive any money from a wind PTC extension.

“Reliable, affordable, and ‘always on’ electricity is critical to get our economy back on track,” reads the letter from the group, which includes organizations like American Energy Alliance, the Competitive Enterprise Institute and Heritage Action.

“Extending the wind PTC ensures that your constituents will continue to subsidize wind power in other states that have made political decisions to force consumers to buy more expensive and less reliable forms of energy — like wind,” the letter continues.

“By taking a principled stand against the PTC, you help taxpayers in your own state and ensure more cost-effective electricity generation overall,” the letter concludes. “We urge you to allow this wasteful subsidy to expire, as planned, at the end of this year.”

In September, 64 free-market groups, organized by Americans for Prosperity, sent a letter to Congress, also urging them to oppose the extension of the wind PTC, which will cost $12 billion for a one-year extension.

“It is time to end special tax provisions that distort the energy market and increase energy prices. We urge you to let the wasteful wind PTC expire as planned at the end of the year,” says the letter, which was organized by the group Americans for Prosperity.

The wind PTC began in 1992 to get the wind industry on its feet, and has since been renewed seven times. It gives 2.2 cents for each kilowatt hour of wind energy produced for their first 10 years of operation. In 2010, the government spent $5 billion on wind subsidies alone, with nearly all of it coming from stimulus dollars.

Republicans in Congress remain split on the wind PTC.

On the Senate side, Sens. Jerry Moran and John Boozman were among the Republicans who joined Democrats in a letter to Senate leadership, urging them to take up the extension issue.

Recently, Iowa Republican Sen. Chuck Grassley expressed his support for the wind PTC in a video that urged Congress to extend the tax benefit, rather than let it expire this year.

“This production tax credit for wind is working and should be part of the effort in Washington here to get more Americans working as well,” Grassley said in the video. “Certainty about tax policy and affordable energy are factors for economic growth.”

Republicans in the House are split on the issue as well, but House Speaker John Boehner has come out against extending the tax credit.

“Despite having this generous subsidy for two decades, wind only produces 3 percent of America’s electricity,” reads the December letter from free-market groups. “This corporate dependence on federal subsidies not only harms the taxpayers who finance the PTC, it also creates an improper incentive for wind companies to focus on obtaining lucrative subsidies rather than long-term sustainability and competitiveness.”

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