Romney confirms he would end US wind power subsidies -- Clearly favors keeping big oil's subsidies

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from the guardian.co.uk: http://www.equities.com/news/headline-story?dt=2012-08-02&val=337793&cat=energy

Mitt Romney looks set to declare war on America's wind energy industry, further emphasising the dividing line between the presumptive Republican presidential candidate and President Barack Obama on energy issues.

Romney's campaign confirmed this week he wants to end long-standing tax credits for wind farm projects when the incentives come up for review later this year.

The pledge means the popular production tax credits (PTCs) – which have helped drive a surge in new wind energy investment in the US, making it the second largest wind energy market in the world after China – would be allowed to expire at the end of this year if the Republicans secure the White House in November.

Shawn McCoy, a spokesman for Romney's Iowa campaign, told the Des Moines Register earlier this week that Romney would "allow the wind credit to expire, end the stimulus boondoggles, and create a level playing field on which all sources of energy can compete on their merits".

He added that wind energy would still be allowed to "thrive wherever it is economically competitive, and wherever private sector competitors with far more experience than the president believe the investment will produce results".

Romney's campaign later confirmed he planned to allow the tax credits to lapse, stressing that he favours an energy policy environment where technology-specific incentives are removed.


from PolitiFact: http://www.politifact.com/florida/statements/2012/apr/06/priorities-usa-action/mitt-romney-pledged-protect-oil-companies-tax-b/

Taxpayers for Common Sense concluded in a 2011 report that the oil and gas industry are poised to get $80 billion in subsidies during the next five years, and that the industry has doled out $140 million over the past decade to influence federal policy.

(The Sierra Club) pointed to Romney’s statement about oil subsidies in April 2011, when he declined to take a position on current tax breaks and again talked about lowering overall corporate taxes.

The Sierra Club also points to the hefty campaign contributions Romney has received from oil and gas -- more than $750,000 according to the Center for Responsive Politics -- and the pro-Romney Restore Our Future PAC has received almost $1 million.

The Sierra Club also notes that Romney’s chief energy adviser, billionaire oil executive Harold Hamm, has urged Congress to maintain the tax breaks for industry members. "Thousands of American jobs they create will be lost if 30 to 40 percent of the capital for drilling is eliminated through the loss of tax provisions," Hamm wrote in 2011. The next year, Hamm wrote that eliminating deductions for the industry "would give us no option but to reduce our drilling programs, resulting in fewer jobs and higher prices."

. . . there are signs that he is favorable toward maintaining those tax breaks. The most notable evidence is his campaign memo’s criticism of Obama for wanting to increase taxes on the industry and the fact that his energy adviser is an oil executive who opposes "punitive tax increases."

[CanonRay]

1. He's perfectly and exactly wrong on everything

Every single, bloomin' policy or idea you can express, Rmoney will have the opposite and completely bad policy or idea.

[badtoworse]

2. Mitt is right on this issue

The subsidies have succeeded in their intended purpose, i.e. to establish the wind industry and provide the critical mass needed to keep it going. That has happened - wind turbines are a big business, but they would not have gotten that way without the subsidies.

It's now time for the wind industry to reduce its costs so that it can directly compete with other forms of power generation. Wind has two big problems: Natural gas has gotten very cheap and a modern, clean, gas-fired combined cycle plant can generate power for about $30 - $40 per megawatt-hour. Even with subsidies, wind has a tough time doing it for less than about $45 and without subsidies, wind is north of $50. The second problem is that wind power can't be controlled (i.e. respond to load changes) the way other forms of generation can. That makes it inherently less valuable.

Maintaining the subsidies will not solve these problems. I could support a more gradual phaseout, but the subsidies need to go.

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3. can 'wind' really 'compete' with the continuing support that gas producers are advantaged with?

It doesn't make sense to expect wind energy (or any other alternative to gas and oil) to compete with the massive support that the oil and gas industry receives. I don't think we should expect that the wind energy firms can stand on their own when they're, essentially, being undermined by the government's propping up of gas and oil.

[badtoworse]

5. How much would natural gas cost without any subsidies?

The Wind Production Tax Credits that will expire are worth $21 per megawatt-hour. That is equal to the impact of a $3 increase in the cost of natural gas, roughly double what gas is currently selling for.

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6. wouldn't eliminating them still leave the firms at a disadvantage?

That would be $0 per megawatt-hour.

I do think there are many problems associated with getting the wind industry on a solid footing which the industry shouldn't be expected to bear all by themselves, IF we're really serious about standing them up as a significant alternative, and, aren't just looking at forcing natural gas to the surface as a panacea to the economic and environmental problems associated with our reliance on gas and oil.

There are many other considerations in support for subsidies for wind energy beyond just the cost-benefit analysis. Conversely, there are also negative impacts of gas extraction and production to consider (as the industry stands today). it's a matter of priorities. I believe the environment is a primary consideration, and that wind energy is worth investing our tax dollars in -- if we are serious about changing our reliance on drilling for oil -- and that it is essential to have a healthy mix of alternatives at the outset of this challenge for consumers to adopt and take advantage of.

[cbdo2007]

4. aren't all subsidies Socialism?? Obviously he's a Socialist.

[LondonReign2]

7. Republicans are all for government handouts

when it is an industry the lines their pockets in return...unlike the poor, who don't do a thing for their bank accounts

They are ginormous blatant hypocrites, and most Americans never make the connection.