SEn. Franken's Floor Statement on Extending the Production Tax Credit
M. President, I rise today to urge my colleagues in the Senate to support an extension of the renewable energy production tax credit. This tax credit, currently slated to expire at the end of this year, has created thousands of jobs for the wind industry, has reduced our dependence on foreign oil, and is hugely important to Minnesota and the nation. But because it takes a lot of time to order and manufacture new wind turbines, investors need to know now that the credit will exist in 2013 or else they won’t invest. That’s why the credit must be extended now, along with the payroll tax extension and unemployment benefits.
If Congress lets the renewable energy production tax credit expire, we will let down the 80,000 people working on wind farms and manufacturing facilities across the nation, and we may cost this country $10 billion dollars in lost investment. Already, because of uncertainty about the fate of the production tax credit, investment in the wind industry is drying up. America cannot afford to wait any longer. Congress must act now to extend this important measure for American business and manufacturing.
Just a few weeks ago, I received a letter from Terry and Janet Carlson, who run a family farm in Parkers Prarie Minnesota and are developing a wind project in their community. They write: “Our family believes in renewable energy and the benefits it can provide to our local community. Besides being environmentally friendly, wind energy has proved to be a great economic benefit to the State of Minnesota and small communities such as ours.
“But the 2012 expiration of the production tax credit has created a high level of uncertainty in the wind industry… We have a significant amount of time and money invested in this project and the production tax credit expiration has a significant impact on our project moving forward. It also has a significant impact on the thousands of renewable energy related jobs in America and the economic boon it would provide to our community.”
Terry and Janet have good reasons to be concerned. A Navigant Consulting study found that if the production tax credit is not extended, construction of wind turbines will drop by 75 percent in 2013. That means a lot fewer manufacturing jobs and construction jobs. In fact, if Congress fails to extend the production tax credit, the wind industry will lose half of its jobs, dropping from about 80,000 in 2012 to 41,000 in 2013. 39,000 well paying construction and manufacturing jobs will evaporate if Congress fails to extend this tax credit.
On the other hand, this tax policy has major potential for the American economy. With a four-year extension, the production tax credit will continue to support growth of the wind industry, boosting construction of wind farms by 25 percent. And instead of losing 39,000 jobs, an extension of the wind production tax credit will create 15,000 well-paying construction and manufacturing jobs.
With the help of the renewable energy production tax credit, the wind industry has been a bright spot in these tough economic times. There are over 400 facilities across 43 states manufacturing for the wind energy industry. 16 of those facilities are in Minnesota, supporting about 3000 jobs. Currently a majority of wind industry parts are produced here in America, whereas in 2005, just a quarter of components were made in this country.
That’s the story we want to hear! Instead of exporting manufacturing jobs to other countries, the wind industry has been bringing well-paying high tech jobs back home to America, where the technology was first invented. That’s thanks to the renewable energy tax credit.
If we don’t extend this tax credit, we’ll fail these facilities and the people whose jobs are at stake. As uncertainty about the tax credit deepens, we’ve already seen that orders to wind manufacturing facilities are slowing down, and companies are making layoffs. This is our fault here in Congress, and it is unacceptable. The longer we wait, the worse the layoffs and shutdowns will get.
And in fact, if we don’t extend the tax credit this month, it will be too late for the wind industry to build any turbines in 2013. Wind turbines are big and wind farms need to plan and order parts a year in advance. If wind farms can’t depend on the tax credit for 2013, they can’t make plans to build for next year, which means they can’t make orders to 400 manufacturing facilities across the country for parts.
Because of the uncertainty of the tax credit in 2013, production now in 2012 has already come to a halt. That’s why we need to extend this tax credit now, immediately, in the payroll tax package.
For the past few months, we’ve celebrated reports that the unemployment rate is improving. This is fantastic news. But we can’t rest on our laurels yet, and we must be sure to enact smart policies that promote businesses and job growth in the parts of the economy that need it the most. The renewable energy tax credit does just that. It will promote growth in manufacturing and construction, industries that deserve our help the most.
America has tremendous wind resources, much of which is still untapped. Take Minnesota for example — we’re ranked fifth in the country for the most installed wind capacity. And yet our wind resources could still provide 25 times more energy! This is a huge opportunity for this country.
Wind blows all over the nation, in red states and blue states alike. It is an abundant cheap clean energy resource that is proving to be a boon to our economy. We can’t stop developing it now. I urge my colleagues to extend the renewable energy production tax credit immediately — at the same as we extend the payroll tax cut and unemployment benefits.
Thank you, and I yield the floor.