Could Wind Subsidies Blow Taxpayers Over the Fiscal Cliff?

 When the South Dakota Wind Energy Association gathers for their annual meeting in Mitchell, they will spend a lot of time talking about the main tax break for wind energy, which is scheduled to expire at the end of December.

While SDWEA is considering ways to pamper the wind industry in South Dakota, members of Congress are having the same conversation on Capitol Hill.

When facing pleas from special interests to extend the wind Production Tax Credit (PTC), Congress needs to take a step back from the rhetoric and take a close look at the facts. The wind PTC is a wasteful handout that has done much more harm than good, and Congress should ignore these politically-charged calls to extend it.

Proponents argue that the wind industry needs the PTC in order to get off the ground. But they fail to mention that the wind industry has been getting subsidies for nearly 20 years, and it has yet to show any signs of independence. Even though the PTC has been around since 1992, the wind industry remains miserably dependent on it.

Taxpayer subsidized investment in the wind energy may have allowed wind turbine makers to plump up their payrolls, but it has hurt taxpayers and slowed overall economic growth. Americans are struggling in the down economy, yet the federal government continues to send billions of their tax dollars to keep the wind industry afloat. The extension plan that’s sitting in the Senate would cost over $12 billion in 2013 alone.

By giving special tax breaks to wind energy, the federal government continues the dubious practice of using the tax code to favor certain groups over others. The government has a terrible track record when gambling with taxpayer dollars – look no further than Solyndra, Beacon Power, Ener1, and most recently A123 Systems. Now is the time to stop making bad bets in the energy market. Propping up inefficient, unviable industries with subsides is not a sustainable energy policy in the long term.

Our elected officials in Washington have a responsibility to examine the proposals on the table and ask the hard questions about the future of energy subsidies. A big part of that is standing up against the special interests in the wind lobby and putting taxpayers first.

Congress should let the wind PTC expire at the end of the year, as scheduled.

*** Christine Harbin *** is a policy analyst for Americans for Prosperity, the nation’s premier free market grassroots organization.

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