Time for Texas’ leaders to support important wind-power tax credit
What
if our leaders spent $7 billion on a new superhighway that would better connect key parts of Texas to create trade, jobs, investment and tax revenue — but then decided, after all the money was committed and the highway had been built, to take steps to make sure it wouldn’t be used? Most people would say that makes no sense at all.
But that is exactly what is happening with Texas’ new electricity transmission superhighway, called the Competitive Renewable Energy Zones, or “CREZ,” project. The idea of these new CREZ transmission lines is to connect Texas’ cheapest and cleanest energy resource, the windy areas of the Panhandle and West Texas, with our increasingly power-hungry cities. It is a bold plan to leverage billions of ratepayer investment in order to produce many more billions in private investment and economic growth. Yet just when the CREZ lines are ready to operate, many Texas leaders are turning their backs on wind power and threatening to turn the CREZ project into a giant bridge to nowhere.
This is happening because, as we count down the last days of 2012, we are also counting the last days of the federal Production Tax Credit or “PTC” for wind energy. The PTC was first passed by President George H.W. Bush in 1992 and has been extended on a bipartisan basis many times since then. It works to level the playing field for wind energy against the massive tax incentives and loan guarantees our government provides to coal, natural gas and nuclear companies. (A 2006 study by Texas Comptroller Susan Combs found that wind receives only 3.4 percent of all federal energy support, while coal, nuclear, oil, and gas get more than 50 percent.) Without the PTC in place to counter the fossil/nuclear subsidies, it is unlikely that the next few years will see more than a small fraction of the new wind projects originally planned for the CREZ lines.
Many of our leaders recognize the need to extend the wind tax credit. U.S. Rep. Mac Thornberry, R-Clarendon, in the wind-rich Panhandle, for instance, has advocated a long-term extension of the wind tax credit, as has Rep. Lloyd Doggett, D-Austin. A number of Republican governors, senators and representatives are strong supporters, as are Democrats from the president on down. But after Mitt Romney flip-flopped during his presidential campaign by speaking out against a production tax credit extension, some Republicans changed their tune, including many Texans.
No one embodies the reversal on wind energy more than Gov. Rick Perry. Back at the CREZ launch ceremony in 2006, Perry said, “This is a landmark day as the State of Texas partners with private industry to make a historic investment ... in new wind energy infrastructure that will diversify our energy production, clean up our air and help Texas surpass our renewable energy goals.” He went on, “We are on the leading edge of developing renewable sources of energy and a more diversified energy economy which is key to keeping costs down.”
Today, however, Perry opposes extending the wind tax credit, and he’s not alone. Texas Sen. John Cornyn voted against the current Senate bill to extend the credit, and six Texas Republicans — Reps. Joe Barton of Ennis, John Carter of Round Rock, John Culberson of Houston, Bill Flores of Bryan, Louie Gohmert of Tyler and Pete Olson of Sugar Land — signed a letter opposing any extension. These same congressmen are not against energy subsidies, just those for wind; each voted only last year to extend oil industry subsidies. Other Texas Republicans are silently opposing an extension or standing idly by as the clock ticks down. Reps. Randy Neugebauer of Lubbock and Michael Conaway of Midland whose districts have more wind turbines than any others in the nation, won’t say whether they back the current extension of the wind credit.
What’s changed since 2006? Just politics. Given the $7 billion we’re now spending on the CREZ lines, Texas elected officials should be leading the charge to renew the wind tax credit. But they aren’t, and their position is very shortsighted when Texas’ energy needs continue to grow, our rural areas continue to struggle for investment, and wind continues to offer plentiful, cheap energy from right here in Texas.
These are precisely the reasons why the CREZ lines made good sense for Texas in 2006, and why they still do in 2012. We’ve already built them. We’re already paying for them. So why not support the wind tax credit to ensure we can use them?