New Wind PTC Proposal Would Dramatically Decrease Incentive Before Eliminating It
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If the latest proposal for the wind Production Tax Credit (PTC) is approved, it would dramatically decrease the incentive's amount and eventually phase it out altogether.
Introduced on Thursday by U.S. House of Representative Committee on Ways and Means Chairman Dave Camp, (R-MI), the new proposal would retroactively reduce the credit from about 2.3 cents per kilowatt-hour of produced energy to 1.5 cents. The incentive would then be eliminated in 10 years.
Despite a nationwide scramble by businesses hoping to qualify for the credit before it expired in December, Camp's plan presents an unlikely scenario—that industry members actually said they won't need the incentive much longer.
"Businesses in the wind industry have represented to the committee that the industry could survive with a credit worth 60 percent of the current credit, implying that the credit provides a windfall that does not serve the intended policy," the plan reads.
Additionally, 50,000 people signed a petition to renew the incentive and sent it to new Senate Finance Committee leader Ron Wyden, D-OR, just two weeks ago. Before that, the members of the Governors Wind Energy Coalition asked Congress to extend the PTC. They centered their argument around an estimated 5,000-plus layoffs that took place within the industry in late 2012 because of the impending expiration of the PTC. The credit expired Dec. 31, 2012, but Congress temporarily extended it two days later.
“The legislation is highly unlikely to be enacted in its current form," Jeff Davis, a partner at law firm Mayer Brown, told North American Wind Power.
Still, Davis told the publication that Camp's stance that the Internal Revenue Service safe harbor requiring continuous construction for wind projects started by Dec. 31 is too liberal could have a "chilling effect on the wind industry and participants as to what it takes to satisfy the ‘commence construction’ requirements.”
Camp's proposal is part of a nearly 200-page draft of his tax reform act. According to his plan, the PTC provision would increase revenues by $9.6 billion.
Tom Kiernan, CEO of the American Wind Energy Association, believes the proposal would essentially be a slap in the face to an industry that has invest billions in trying to shift the energy supply to cleaner tendencies.
"Retroactive tax increases undermine investors' trust in the U.S. investment environment," Kiernan said in a statement. "To raise taxes retroactively on an industry that has invested up to $25 billion annually in this country and built 550 manufacturing facilities would be bad policy."
Michael Brower, president and CEO of the American Council on Renewable Energy, is concerned that Camp's proposal doesn't do enough to encourage the private investment needed to grow the industry and move society further away from fossil fuels.
"Renewable energy tax policies have been effective and they can be improved to drive even more capital into clean, American-made energy," he said in a statement. "The tax reform plan released [Thursday] would, if enacted, exacerbate an already uncertain policy environment by proposing repeal of effective tax policies while even undermining existing business agreements and contracts by changing the terms of current operating policy."
Visit EcoWatch’s RENEWABLES page for more related news on this topic.
- Redwoods are the world's tallest trees.
- Now scientists have discovered they are even bigger than we thought.
- Using laser technology they map the 80-meter giants.
- Trees are a key plank in the fight against climate change.
They are among the largest trees in the world, descendants of forests where dinosaurs roamed.
Pixabay / Simi Luft<p><span>Until recently, measuring these trees meant scaling their 80 meter high trunks with a tape measure. Now, a team of scientists from University College London and the University of Maryland uses advanced laser scanning, to create 3D maps and calculate the total mass.</span></p><p>The results are striking: suggesting the trees <a href="https://www.nature.com/articles/s41598-020-73733-6" target="_blank" rel="noopener noreferrer">may be as much as 30% larger than earlier measurements suggested.</a> Part of that could be due to the additional trunks the Redwoods can grow as they age, <a href="https://www.nature.com/articles/s41598-020-73733-6" target="_blank" rel="noopener noreferrer">a process known as reiteration</a>.</p>
New 3D measurements of large redwood trees for biomass and structure. Nature / UCL<p>Measuring the trees more accurately is important because carbon capture will probably play a key role in the battle against climate change. Forest <a href="https://www.wri.org/blog/2020/09/carbon-sequestration-natural-forest-regrowth" target="_blank">growth could absorb billions of tons</a> of carbon dioxide from the atmosphere each year.</p><p>"The importance of big trees is widely-recognised in terms of carbon storage, demographics and impact on their surrounding ecosystems," the authors wrote<a href="https://www.nature.com/articles/s41598-020-73733-6" target="_blank"> in the journal Nature</a>. "Unfortunately the importance of big trees is in direct proportion to the difficulty of measuring them."</p><p>Redwoods are so long lived because of their ability to <a href="https://www.nature.com/articles/s41598-020-73733-6" target="_blank" rel="noopener noreferrer">cope with climate change, resist disease and even survive fire damage</a>, the scientists say. Almost a fifth of their volume may be bark, which helps protect them.</p>
Carbon Capture Champions<p><span>Earlier research by scientists at Humboldt University and the University of Washington found that </span><a href="https://www.sciencedirect.com/science/article/pii/S0378112716302584" target="_blank" rel="noopener noreferrer">Redwood forests store almost 2,600 tonnes of carbon per hectare</a><span>, their bark alone containing more carbon than any other neighboring species.</span></p><p>While the importance of trees in fighting climate change is widely accepted, not all species enjoy the same protection as California's coastal Redwoods. In 2019 the world lost the equivalent of <a href="https://www.worldwildlife.org/threats/deforestation-and-forest-degradation" target="_blank" rel="noopener noreferrer">30 soccer fields of forest cover every minute</a>, due to agricultural expansion, logging and fires, according to The Worldwide Fund for Nature (WWF).</p>
Pixabay<p>Although <a href="https://c402277.ssl.cf1.rackcdn.com/publications/1420/files/original/Deforestation_fronts_-_drivers_and_responses_in_a_changing_world_-_full_report_%281%29.pdf?1610810475" target="_blank" rel="noopener noreferrer">the rate of loss is reported to have slowed in recent years</a>, reforesting the world to help stem climate change is a massive task.</p><p><span>That's why the World Economic Forum launched the Trillion Trees Challenge (</span><a href="https://www.1t.org/" target="_blank" rel="noopener noreferrer">1t.org</a><span>) and is engaging organizations and individuals across the globe through its </span><a href="https://uplink.weforum.org/uplink/s/uplink-issue/a002o00000vOf09AAC/trillion-trees" target="_blank" rel="noopener noreferrer">Uplink innovation crowdsourcing platform</a><span> to support the project.</span></p><p>That's backed up by research led by ETH Zurich/Crowther Lab showing there's potential to restore tree coverage across 2.2 billion acres of degraded land.</p><p>"Forests are critical to the health of the planet," according to <a href="https://www.1t.org/" target="_blank" rel="noopener noreferrer">1t.org</a>. "They sequester carbon, regulate global temperatures and freshwater flows, recharge groundwater, anchor fertile soil and act as flood barriers."</p><p><em data-redactor-tag="em" data-verified="redactor">Reposted with permission from the </em><span><em data-redactor-tag="em" data-verified="redactor"><a href="https://www.weforum.org/agenda/2021/03/redwoods-store-more-co2-and-are-more-enormous-than-we-thought/" target="_blank">World Economic Forum</a>.</em></span></p>
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