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November 29, 2012

Gone with the wind? Environmental group goes to bat for expiring tax credit

— America’s wind-energy industry, including operations in the Laurel Highlands, is facing an uncertain future.

The federal wind-production tax credit is set to expire on Dec. 31. It has been an integral part of wind development for the past 20 years, helping developers and investors reduce their tax bills by 2.2 cents per kilowatt-hour generated during the first 10 years of a project. The deductions can sometimes reduce the total cost of operations by one-third.

With the expiration looming, production in wind-related businesses is slowing. Locally, Gamesa, a turbine manufacturing company, has laid off more than 160 workers from its Cambria Township plant throughout 2012, including 92 in November.

On Wednesday, representatives from PennEnvironment and the office of U.S. Rep. Mark Critz, D-Johnstown, gathered at City View Bar & Grill in Westmont to discuss the tax credit.

“Regardless of how you feel about larger issues, the production tax credit is a smart business move,” said Jim Penna, Critz’s district director. “Not having a production tax credit has caused 100 Cambria County families to have an uncertain Christmas. These people have been laid off for no good reason. It’s a smart program. Being pro-production tax credit does not have to make you anti-anything.”

At the same event, PennEnvironment clean water advocate Erika Staaf touted a recent report, sponsored by her group, that analyzed wind’s ability to help reduce global warming and pollution.

“The point of the report is to demonstrate the real, quantifiable environmental benefit of wind power and clean renewable energy,” said Staaf. “With the wind already blowing in Pennsylvania and captured through wind turbines and wind farms, we are already saving more than 218,000 (cars’ worth) of greenhouse gases from that wind power that we’re already capturing and using for electricity.”

Other groups oppose extending the credit, including a coalition of 88 organizations brought together by Americans for Prosperity, an advocate for limited government and free markets.

“Generally speaking, we believe that tax credits distort the market,” said Adam Nicholson, state communication manager for Americans for Prosperity, during a telephone interview. “Any good energy policy can be proven on the open market.”

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