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Billings Gazette
by: Gazette Opinion
November 25, 2012

Gazette Opinion: Keep tax credit that spurs wind energy growth

When businesses harness Montana’s wind energy, private landowners, local and state governments and workers share the benefits.


More than a dozen wind farms scattered across Montana have a total electricity generating capacity of 647 megawatts. They represent $1.3 billion in capital investment, creation of 1,319 construction jobs and 86 permanent jobs. Together, they paid $5.4 million in taxes in 2010. By 2018, these same wind farms will be paying $8.9 million in property taxes as abatements expire.


Wind farms are helping Montana utilities, including NorthWestern Energy, meet a state law requirement that 15 percent of energy supplied will be from renewable sources by 2015. And recent wind contracts are keeping costs down for ratepayers.


Montana wind farms are producing energy at competitive prices. Their pricing reflects the federal Production Tax Credit that has boosted U.S. wind energy capacity from 1.5 gigawatts in 1992 to 45 gigawatts in 2011.


Despite that growth, wind still has a small slice of the U.S. energy market. By the end of last year, wind generated about 3 percent of the nation’s electricity supply, according to the Energy Information Administration.


The U.S. government has long subsidized domestic energy production. The production tax credit for wind utilities is part of that effort to ensure that business will produce the energy America needs at home.


The tax credit spurred investment in recent years as wind technology has advanced and increased efficiency and productivity. However, the tax credit is scheduled to expire Dec. 31.


With no tax credit, Montana is unlikely to see more new projects like the Musselshell Wind Farm, two 10-megawatt projects which started construction last month near Shawmut. The credit will pay 2.2 cents per kilowatt generated by the wind farm for its first 10 years of operation.

 

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