Industry officials at Platts 27th Global Power Markets conference appeared guardedly optimistic that the production tax credits for wind would be extended at some point, although the 2013 wind market could still suffer if the extension comes late in the year. The PTC offered by the U.S. Department of Treasury is set to expire Dec. 31.
PTC programs expired in 1999, 2001 and 2003, only to be renewed, so industry executives are cautiously optimistic that a bill could pass with the PTC slipped in, perhaps during the lame-duck session. Kevin Smith, ceo at SolarReserve, said that he’s optimistic the PTCs will be extended, no matter which party is in power, adding, “Republicans are not going to destroy an entire industry.”
The legislature thinks that development can be turned on a dime and doesn’t realize the long development process, Kevin Walsh, managing director of power and renewable energy at GE Energy Financial Services, said to attendees. If the extension comes at the end of the year, then 2013 will have a lean pipeline as sponsors play catch-up with early-stage projects. Some wind will go into construction because “most developers are keeping a few [projects] at a simmer,” said Chris Taylor, chief development officer for North America at Element Power.
Bill Harrison, head of renewables execution team in structured finance for North America at BBVA, told the audience that it’s challenging and frustrating to build a sustained, consistent industry when policy uncertainty creates shifting peaks and valleys in installation cycles.