The Production Tax Credit (PTC) is a little-known federal incentive that can promote economic development from the private wind industry here in the United States. While wind farms have been slow to develop here in the Southeast, our region already benefits from the PTC. Yet, a misinformation campaign run by the Institute for Energy Research (a Washington, DC-based group that receives funding from the fossil fuel industry) ignores the facts and blindly states that the Southeast receives absolutely no benefit from the PTC. Listed below are just a few ways the wind energy PTC benefits our region.
The PTC Reduces Contract Prices and Low-Cost Power is Imported into the Southeast
The production tax credit reduces electricity prices from wind farms, so utilities can buy wind energy at a lower rate. Those utilities can then pass those savings on to ratepayers. Below is a synopsis of some of the low-cost wind power purchases made in the Southeast.
- Alabama Power is purchasing 404 megawatts of wind power from Oklahoma and Kansas. One reason cited for the purchase is to reduce ratepayer costs.
- Arkansas Electric Cooperative Corporation has signed a contract for 51 megawatts of wind power from Oklahoma.
- Georgia Power has agreed to purchase 250 megawatts of “cost-effective wind energy” from Oklahoma.
- Southwestern Electric Power Company is purchasing 469 megawatts of wind energy from Texas, Kansas and Oklahoma. SWEPCO is a utility in Arkansas, Louisiana and Texas.
- Tennessee Valley Authority is purchasing more than 1,500 megawatts of wind energy from the upper Midwest.
The PTC Encourages Wind Farm Development, Wind Farms Create Domestic Manufacturing Jobs in the Southeast
According to Lawrence Berkeley National Laboratory, 72% of wind turbine components are now made in America. When a wind farm development company buys a wind turbine, that purchase spurs domestic manufacturing. Thousands of jobs exist in the Southeast specifically to serve the domestic and international wind energy industry. A few manufacturing highlights are listed below.
- Recently, General Electric won a $1.4 billion contract to supply wind turbines to the nation’s largest wind farm – the Shepherds Flat project in Oregon. The 2.5-megawatt turbines are manufactured in Pensacola, Florida.
- Hailo USA, a wind turbine component manufacturer, recently opened its $10 million headquarters and manufacturing facility in Elberton, Georgia.
- PPG Industries manufactures fiberglass used for wind turbine blades in Shelby, North Carolina.
Wind Farm Development in the Southeast is Inevitable; When Built, Southern States Will Further Benefit from the PTC
Wind farms have now been evaluated and/or proposed in every state in the South, in part because of better wind turbine technology, but also because of the Production Tax Credit. In addition to low-cost energy and manufacturing jobs, when wind farms are built in the South, local construction and operations jobs will be created and ongoing local tax revenue will be generated. For example, a proposed 18 megawatt wind farm in Alabama could create over 100 temporary jobs in the state and provide over $6 million in local county tax revenue over the course of the wind farm’s life.
A few other jobs that exist in the Southeast that help serve the wind industry include engineering and design (Keystone Engineering in Louisiana is helping with the Cape Wind offshore wind project in Massachusetts), media and communications (Wind Systems Magazine is based in Pelham, Alabama), academic research (Ole Miss recently finished analysis on wind turbine blade optimization), research and development (Clemson University just dedicated its $110 million drive train testing facility in South Carolina), wind development company headquarters (APEX development company is based in Virginia), training (Siemens just opened a $7 million training facility in Florida for wind turbine technicians) and maintenance and construction crews (Barnhart Renewables services the wind industry across the country and is based in Knoxville, Tennessee).
While it’s clear that the PTC has benefited the Southeast, many jobs are at risk because of Congress’ inability to provide a long-term energy policy. The PTC is slated to end on December 31st of this year, so now is the time to contact your elected officials and voice your support for wind energy jobs in the Southeast. Click here to email your elected officials.