Although President Obama’s other plans may draw partisan responses, his energy policies have widespread support in the wind industry. In addition to proposing a $150 billion investment in U.S. based green jobs, the new President is promoting the establishment of a federal Renewable Portfolio Standard (RPS). The RPS would require that 10% of electricity used in the U.S. be derived from clean, sustainable energy sources, such as solar, wind, and geothermal energy production, by 2012. This national requirement is intended to promote significant private sector investment in renewable sources and create thousands of American jobs, particularly in rural areas.
Furthermore, the federal Production Tax Credit (PTC), currently set to expire at the end of 2009, will be renewed for 5 years under the Obama plan. The PTC is the primary federal incentive for wind power. It has been a major factor in the wind industry’s growth over the last several years. Due to the tax credit, wind energy has become a lucrative industry for institutional investors who buy turbines and fund construction of large wind farms. A five year extension will reduce uncertainty and encourage stability and continued growth in the wind industry.
To fully take advantage of the stimulus provided by a federal RPS and PTC extension, Obama and Biden will have to push for major investments in electricity transmission and monitoring innovations. The current U.S. electrical grid requires expensive and lengthy upgrades to support renewable energy development. Adopting a national utility grid would provide the required capabilities to accommodate our 21st century energy requirements. This new “Smart Grid” should improve reliability and security, provide increased distributed storage, and be more affordable over time to the consumer.
