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Roundtable: US wind looks beyond the PTC
28 February 2013
The US wind market is enduring another bout of uncertainty. With tax equity appetite stagnating and uncertainty over future subsidies, how healthy will the pipeline be? Brian Eckhouse canvasses some market leaders.
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Wind project financings in the US now rely on the production tax credit (PTC) to monetise tax benefits, especially since the US Department of Treasury’s cash grant programme ended on 31 December 2011. Some projects were grandfathered into the cash grant programme, but the number of eligible projects is dwindling. So, the wind sector was especially nervous during 2012, as the PTC neared its own expiry at year-end. The PTC paid $0.022 per kWh in 2012. Congress ultimately extended the grant – but on 1 January 2013, hours after the subsidy had formally expired.
Preserving the PTC was not, however, the only goal for renewables developers, lenders and investors in 2012. Industry groups lobbied Congress and the Internal Revenue Service (IRS) to help them attract retail investors into renewables – efforts that have continued into 2013. To unlock retail interest, the renewables industry is urging Congress to allow master limited...
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