Biofuel, wind executives seek tax credit extensions
Source: PUNEET KOLLIPARA, WASHINGTON BUREAU • Houston Chronicle • Posted: Thursday, December 15, 2011
Representatives of wind power and biodiesel companies said temporary expiration of the credits in the past hurt production.
The biodiesel sector has relied heavily on a $1-per-gallon blenders’ tax credit, set to expire in at year-end, said Paul Soanes, CEO of Houston-based Renewable Biofuels, whose Port Neches plant is the nation’s largest biodiesel-producing facility.
When the credit lapsed for most of 2010, U.S. biodiesel production fell 40 percent, Soanes told the Senate Finance Committee’s Subcommittee on Energy, Natural Resources and Infrastructure.
This year, with the credit restored, his company’s production rose from 9 million to 62 million gallons – also helped for the first time by a new renewable-fuel mandate, Soanes said
If Congress doesn’t extend the credit, Soanes said, American biofuel production will decrease, resulting in job losses.
A number of tax credits for renewable energy production are set to expire in the coming years, raising concerns among alternative-energy advocates about the country’s economic well-being and U.S. competitiveness in shifting away from fossil fuels.
A tax credit for new wind farms expires in late 2012, and Congress should extend it now because companies already are making planning decisions for 2013 projects, said Martha Wyrsch, president of the American arm of Vestas, a wind-turbine manufacturer headquartered in Denmark.
Texas leads the U.S. in biodiesel and wind-generation capacity, the Texas Energy Foundation says.
Some committee members were skeptical about extending the credits.
“You can’t make the case for tax credits going on forever,” said Sen. Ron Wyden, D-Ore., though he lamented that some industries have long-term incentives while others’ are temporary.
Wyrsch and Soanes said biodiesel and wind could become competitive enough to go without tax support within five years.