Iowa generates 20 percent of its electricity with wind turbines and employees 7,000 people in the wind industry.
That’s why the fate of the federal wind production tax credit is important to voters in the state–and why news from staffers that presidential hopeful Mitt Romney would hasten the tax credit’s end is poorly received by Republicans and Democrats alike in Iowa.
Romney has already put a lot of effort in winning over the voters in the swing state, but according to staffers, if elected, Romney would either let the credit expire at the end of the year (as it is set to unless Congress intervenes) or phase it out in 2013.
Romney has made his negative position on clean energy–and his support of continued tax credits to the oil and gas industries–very clear during his campaign. In contrast, President Barack Obama openly supports an indefinite extension of the tax credit and called for more federal support for green technology in the U.S.
The wind industry in Iowa has united members of opposing political parties within the state who see wind as an integral part of state’s economic and energy future. Industry insiders and policy makers from both sides of the aisle say that the federal wind production tax credit is vital to the industry’s growth in Iowa.
For every kilowatt-hour of wind electricity that is produced, the production tax credit pays wind developers a tax benefit of 2.2 cents. Wind industry experts say that if the tax credit is allowed to expire, the repercussions will ripple over the country, resulting in major layoffs across the country–as many as 37,000 this year alone.
The Midwest would be particularly affected; it is home to hundreds of companies related to the wind industry. Illinois, for example, hosts over 150 companies with 67 involved in the manufacturing or production at some level of equipment for wind turbine construction.
With the uncertainty surrounding the future of the tax credit, many wind projects have been halted around the country. Some wind manufacturers have scrapped factory expansion plans and furloughed or laid off workers in advance of a final ruling. Other manufacturers have already switched to an export model for the international market instead of planning on domestic sales to keep them afloat.
November elections are fast approaching and the Obama campaign has increasingly focused the clean energy industry as a defining point for Midwestern voters.
Vice President Joe Biden, at a campaign stop in Iowa, told the crowd, “You had our good friend Mitt Romney saying he dismissed wind and solar by saying they’re ‘two of the most ballyhooed forms of alternative energy.’ Tell that to the 7,000 workers manufacturing wind power here in Iowa.”