'Hallelujah!' Wind subsidy extended by Congress
The last-minute budget deal struck Tuesday by Congress to avoid the so-called fiscal cliff includes a provision that extends federal funding for wind energy for at least another full year.
That issue has been hotly debated for years in southeast Minnesota as organized opposition has emerged to question the viability of that emerging renewable energy.
While not the six-year extension that wind advocates had pushed for throughout 2012, the reaction from the wind industry was still upbeat — especially for a state already fifth in wind energy installation.
"Hallelujah!" said a Gamesa Energy receptionist when informed of the move.
Gamesa owns one of the 13 Minnesota wind projects that ended December facing an uncertain future, including two in southeast Minnesota. The Spain-based company's stock rose by 7.8 percent in the hours immediately following Congress' decision. According to the American Wind Energy Association, an wind-industry group, the deal will save about 37,000 jobs across the country and allow manufacturing plants of turbine parts to continue to thrive.
The wind production tax credit provides 2.2 cents per kilowatt of energy produced over the project's first 10 years, which equates to about $1 million per commercial turbine. Democratic Minnesota Sens. Al Franken and Amy Klobuchar have been vocal supporters of that renewable energy subsidy, while Minnesota Rep. John Kline, a Republican, was among those calling to let it expire.
"President Obama and clean energy champions, including SenatorsKlobuchar and Franken and Representative (Tim) Walz, helped make this ahappy holiday for our health and our environment by extendingcritical tax credits for wind energy," wrote Environment Minnesota, a citizen-based advocacy group in a press release. "Wind powers nearly 13 million homes across the country already, andin Minnesota wind power avoids as much global warming pollution astaking 757,000 cars off the road each year."
The extension figures to be well-received for a handful of local wind developments. The EcoHarmony project in Fillmore, a 280-megawatt development owned by Gamesa, has been on hold for months as it awaited word on the PTC.
The 301-megawatt Pleasant Valley Wind project located in Mower and Dodge counties has been in limbo since being approved in Dec. 2010. Calls to RES Americas, the owner, were not returned Wednesday, but officials have previously said that the $600 million project hinged on the PTC renewal.
The language of the new extension differs from previous versions. The 2009 extension required that projects be on the grid and operational by Dec. 31, 2012 to be eligible for federal funding. The one-year extension alters that to simply require construction to have started by Dec. 31, 2013 to be eligible for federal funding. Construction can take 6-12 months for larger projects.
"You're talking about a 12-18 month cycle for a wind project (to be approved and built)," said David Rosenberg, Gamesa Vice President of Marketing. "Right now, those people need to bring back their developers, many of which have been laid off in the last year … because of the uncertainty."
Goodhue County has received national attention for an especially contentious project now called New Era. The 78-megawatt development has been under consideration by the state since 2008. New owner and developer Peter Mastic, who did not return calls Wednesday, has previously said he planned to move forward regardless of the PTC decision.
Many of the local critics have tried to add their voice to national complaints, citing uncertain energy benefits along with health and environmental concerns about wind energy. Two flew to meet North Carolina resident John Droz, a retired physicist and member of the conservative group American Tradition Institute.
"In my view, our situation was something akin to defending the Alamo," Droz said, noting five previous extension votes failed over the last 15 months.