All it takes is a drive east on Interstate 84 past the Columbia River Gorge to appreciate the remarkable growth of wind energy in Oregon.
Wind turbines that barely existed a decade ago now speck the horizon on either side of the Columbia. Wind companies have invested more than $4.5 billion in Oregon, generating 3,000 jobs, providing millions in tax revenues for state and local governments and helping ranchers, farmers and rural communities survive the Great Recession. Oregon ranks sixth nationally in production, generating 10.5 percent of its power from wind.
At the national level, wind energy supports 75,000 jobs, and the wind industry has invested billions — $14 billion in 2011 alone — in developing a supply chain in the United States.
But the industry has hit hard times. A story this month in the New York Times says 10,000 jobs have disappeared over the past four years as wind companies have been hit by a falling demand for power, competition from cheap domestic natural gas and huge subsidies by Asian countries that allow foreign competitors to underprice U.S. manufacturers.
Despite those setbacks, wind energy has made impressive gains. There remains a huge potential for industry growth as the U.S. economy continues its recovery and new energy technologies are developed.
But that potential is threatened by the possibility that Congress may allow a federal tax credit that makes wind power more competitive with other sources of electricity to expire at the end of this year.
That would be a mistake. While wind power has made major gains, it still needs time and federal assistance to catch up with the competition. At a time when Middle East oil is vulnerable to disruption and fossil fuels are key contributors to global warming, Congress should commit to the continued development of wind power.
Critics, including Republican presidential nominee Mitt Romney, argue that the wind industry has failed to produce a sufficient return for the taxpayer dollars that have been invested in it. Yet the federal production tax credit for wind has cut the cost of electricity from wind power to the point where it is often competitive with natural gas.
A sudden end to federal subsidies could reverse those gains — industry analysts warn of a 75 percent reduction in new investment and a hefty decline in jobs. The threat of ending the production tax credit has made project developers and manufacturers reluctant to make new investments.
There will come a time, perhaps in the not-too-distant future, when the federal government should step away from wind-energy subsidies. But that time has not yet arrived.