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Broadening Wind Energy Ownership by Changing Federal Incentives

| Written by John Farrell | 9 Comments | Updated on Apr 5, 2008 The content that follows was originally published on the Institute for Local Self-Reliance website at http://www.ilsr.org/broadening-wind-energy-ownership-changing-federal-incentives/
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A typical 2 megawatt wind turbine provides enough electricity for around 600 average American homes.  So why is it nearly impossible for those same 600 households to pool their resources and own a wind turbine?

There are two significant barriers to owning and investing in renewable energy projects.  First, the federal renewable electricity incentive — the production tax credit (PTC) — limits the type and amount of income tax that can be applied.  Second, the Securities and Exchange Commission (SEC) has complicated and expensive registration fees for sizable cooperative investments.  If lawmakers want Americans to achieve energy independence, they need to revise the PTC and simplify SEC registration.

This policy brief shows how removing two barriers to owning and investing in renewable energy projects can pave the way for true energy independence.

A 2008 bill by Representative Tim Walz (D-MN), H.R. 2691, addresses part of the tax problem by making the federal tax incentive for wind power available to up to a third of all Americans.

“Removing this barrier to energy ownership makes smaller projects more accessible to the local community, and draws local investors back into the process,” says Farrell. “Plus, ownership brings more economic benefits to a community than an absentee firm putting up a turbine.”

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About John Farrell

John Farrell directs the Energy Self-Reliant States and Communities program at the Institute for Local Self-Reliance and he focuses on energy policy developments that best expand the benefits of local ownership and dispersed generation of renewable energy. More

Contact John   |   View all articles by John Farrell

  • RobinhoodStFrancis

    Thanks to John Farrell for identifying a strong starting point for wind power development!

  • Eric B

    There is a 50MW wind farm proposal in our county, and I would love to see it locally owned, either by the county or by towns bonding together. Or maybe the school district and the college, some combination would make sense for everyone. So seeing legislative changes like this that would encourage that is exactly what we need to get our economy going and create local jobs and local energy production.

    Eric B
    Ithaca, NY
    brew_bird at yahoo.com