Pain of extended wind industry PTC could be felt across nation in 2020, energy and environment advocate says

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An energy and environment advocate says Congress' pre-Christmas extension of the wind industry's multi-billion dollar tax break, the production tax credit (PTC), won't benefit Texas or the nation much, but it will probably will be renewed again next year.

This is the second of a two-part examination of what can be expected from yet again extending the PTC.

Texas already is feeling the effects of a push to make its electrical grid be powered by a high percentage of renewable energy sources, Energy & Environment Legal Institute President Craig Richardson told Texas Business Daily.

Texas' Renewable Portfolio Standards (RPS) mandates doubling its megawatt capacity of renewable energy capacity by 2025. Texas actually surpassed its 2025 target back in 2009 and boasted 26,045 megawatts of additional renewable energy capacity, most of which was wind generated, by 2017 relative to 1999, according to an Electric Reliability Council of Texas compliance report.

Energy & Environment Legal Institute President Craig Richardson   Photo courtesy of Craig Richardson

Getting there has been painful and will continue to be, Richardson said.

"Prior to the push for renewables, we had a very integrated and localized system of producing electricity," he said. "For example, if coal was abundant in one area, they relied on this source, in the Northeast, for part of the year. They import electricity from Eastern Canada where they operate huge hydro systems, and the shale revolution has made clean and inexpensive natural gas available throughout."

The integrated and localized system electrical producing system in Texas is no longer what it was.

"With the government's intervention and their heavy-handed mandates that renewables must be a significant part of the mix – which has zero impact on reducing global CO2 emissions – they’ve created an artificial element to the energy sector based on the subsidies which causes the system to be much more expensive and inefficient," Richardson said.

Richardson's comments came shortly after yet another PTC extension, the 27th in a row, that was part of a $1.4 trillion government spending package of tax extenders approved by both houses of Congress before the holiday break, and more are expected next month. The tax extenders, referred to by a Wall Street Journal editorial as "Return of the Tax Games," were discussed in more detail in the first part of this series.

The PTC extension has been especially problematic for Texas, though it can go unnoticed in the traditional energy-producing state.

"Texas is a big state, obviously, with a large population base," Richardson said. "So, more people are paying taxes. It's also a huge source for traditional energy sources, so having to compete against government-backed renewable energy schemes hurts their local economy."

And it can only get worse, Richardson said.

"Finally, as these renewable energy mandates come online, and the government pushes for these tax credits making them a greater part of the mix, they will cause brown and blackouts like we saw in California last summer," he said.

Pain caused by the extension of the wind industry PTC, and other tax extenders, is felt nationwide.

"The extensions like the wind PTC not only hurt Texas, they hurt all Americans by raising taxes and making us more dependent on renewables," Richardson said. "This will significantly raise the cost of electricity."

That is true, in large part, because wind and solar energy sources "are intermittent and very expensive sources of power," Richardson said. 

"The market has spoken and once subsidies are removed, no one but the wealthiest want to purchase electric vehicles," Richardson said. "The Ford F-150s are still the No. 1 selling vehicles in America, and people love their SUVs."

Yet, it seems likely that the wind industry PTC and other tax extenders will be granted yet again by Congress this time next year.

"As I previously stated, the extenders come backed by a significant army of lobbyists, which includes the 'Greenies,' politicians who don't want to go against the 'renewable fad,' and the wind, solar, and E.V. industries themselves," Richardson said. "Despite doing nothing to improve the 'climate,' the government and their media chorus have bought into renewables and E.V.'s, and most people don't understand how inefficient, costly and detrimental to the economy they really are."

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ELECTRIC RELIABILITY COUNCIL OF TEXAS Energy and Environment Legal Institute

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