Federal subsidies for wind production began under the Administration of President Jimmy Carter with passage of the Public Utility Regulatory Policy Act and the Energy Tax Act. When these subsidies failed to make the industry competitive, Congress, in 1992, created the Production Tax Credit (PTC) to give it a boost. The PTC gives wind energy producers a tax credit of 2.2 cents per kilowatt hour of electricity generated.

Although originally intended as a temporary measure, the PTC has been continually extended by Congress under pressure from the wind industry and renewable energy advocates.

A setback occurred on January 29, 2015, however, when the Senate defeated, 47 to 51, an amendment by Senator Heidi Heitkamp (ND-D) to extend the PTC for another five years. The proposal was considered as an amendment to a bill to approve the Keystone XL pipeline, which was passed but later vetoed by the President.

Following the vote, Senator Heitkamp stated:

There are a lot of senators that talk about supporting an all-of-the-above energy strategy, but clearly many don’t actually mean it. As we continue to calculate a path forward for our energy infrastructure, and for fossil fuels like oil, gas, and coal … we simply cannot leave wind power out of the equation.

Opponents argued that after more than 20 years of being subsidized by taxpayers, it was time for the wind industry to stand on its own.

Meanwhile, in his 2015 budget proposal, President Obama called for a permanent extension of the PTC as well as the solar energy Investment Tax Credit (ITC). While the President’s proposals are unlikely to become law, they may serve as a high starting point for negotiating an extension of subsidies for renewal energy.

For more background, see the February 2013 issue of Congressional Digest on “Wind Energy.”