AFP-TX Letter of Opposition: Extending the Federal Wind Production Tax Credit

December 17, 2012

Dear Texas U.S. Senators and Representatives:

On behalf of the 120,000 Americans for Prosperity activists living in Texas, I’m writing in strong opposition to extending the federal wind Production Tax Credit (PTC), which is scheduled to expire at the end of the year. The PTC was established in 1992, and it provides a 2.2 cent subsidy for every kilowatt hour of electricity produced for ten years of operation. According to estimates from the Senate Finance Committee, a one-year extension of the PTC would cost $12 billion.

The federal government subsidizes wind production to such an extent that it distorts the energy market and drives up energy bills. The PTC gives utilities a strong incentive to favor wind power over more efficient, reliable, and lower-cost sources of energy. Studies show that the subsidy for wind is so large that some areas are running negative electricity rates—meaning the wind industry is actually paying utilities to take its product.

Additionally, the PTC props up the dismal practice of picking winners and losers in the marketplace. Targeted energy subsidies have had a disastrous track record in the United States, and now is the time to end them. New energy technologies should show their value in the marketplace by competing for consumers’ dollars on a level playing field—not by petitioning Washington for favors.

Hardworking Texans deserve an energy policy that is based on market principles, not one that is based on extending handouts to politically connected industries. Enacting policies that distort energy markets and prop up failing industries is not why they sent you to Washington. Over 120,000 Americans for Prosperity activists call Texas home, and they will be watching to see how you vote on this issue. I urge you and your colleagues to oppose extending the wind production tax credit.

Sincerely,

Peggy M. Venable
AFP-Texas Director
Americans for Prosperity

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