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National election rekindles hope for wind energy credit

WICHITA (AP) -- The re-election of President Barack Obama has rekindled hopes by wind energy supporters for the extension of the production tax credit.

Not only was Obama, who strongly backs alternative energy re-elected, but Democrats gained seats in the Senate and House.

The Wichita Eagle reported the American Wind Energy Association has warned the loss of the tax credit, which expires Jan. 1, will lead to 37,000 layoffs as demand for new wind turbines and wind farms drops sharply.

The U.S. House, dominated by Republicans, has opposed reviving the wind energy subsidy. U.S. Reps. Mike Pompeo, R-Wichita, and Tim Huelskamp, R-Fowler, contend the tax credits distort the free market.

But the political mood might be shifting enough to allow an extension before the end of the year, said industry officials.

The production tax credit extension has bipartisan support, including the two Republican senators from Kansas. Last week, Kansas Republican Gov. Sam Brownback and governors from three other strong wind power states -- two Democrats and two Republicans -- again called on Congress to extend the tax credit.

The tax credit is worth 2.2 cents per kilowatt hour for wind power utilities.

"We are in a much better position moving into the next Congress and in the lame duck," Gregory Wetstone, vice president of government affairs for wind farm developer Terra-Gen Power, said during a Nov. 8 panel discussion for lobbyists on alternative energy industry.

Citing the end of the subsidy, Siemens Wind Energy announced in September it would cut 110 temporary contract workers at its Hutchinson turbine immediately and lay off 146 regular employees in two months, meaning employment would be down from more than 400 this summer to approximately 150.

Siemens announced this week it has won contracts for turbines destined for southern California and Chile that would keep the remaining workers employed.

"I am optimistic that we will see a renewal of some sort," said David Boyce, CEO of Wind Capital Group. "That said, Congress has a lot left to achieve in the grand scheme of things. So I'm optimistic that there are a host of matters that will fall under an extenders bill and PTC is one of them."

Boyce last week dedicated his company's newest wind farm, Post Rock Wind Farm near Ellsworth, with a 201-megawatt capacity.

The changing political landscape in Washington has generated cautious optimism in the industry.

"I use this term 'hunker-down mode,' " Boyce said. "Let's just preserve and weather the storm and weather the uncertainty and come out the back end."