Onshore Wind American Manufacturing Act proposes manufacturing tax credits for wind energy

Published on October 06, 2021 by Chris Galford

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A joint effort by United States Rep. Brad Schneider (D-IL) and U.S. Sens. Michael Bennet (D-CO) and Debbie Stabenow (D-MI) yielded the Onshore Wind American Manufacturing Act this week, which proposes tax credits to support domestic manufacturing of related wind energy components.

Specifically, the legislation would create investment and production tax credits and, while supporting domestic onshore wind, also require prevailing wages for its workforce. This, the lawmakers argued, will help U.S. wind energy supply chains compete with global price pressures, decrease reliance on importance of wind equipment from other nations and solidify what has so far been uncertain domestic policy support for wind development.

“In the race against a warming climate, the United States must accelerate our progress on all alternative energy pathways, in particular wind and solar,” Schneider said. “This transition to the green economy will build clean, good paying jobs here at home. It also requires that the federal government fosters and supports the manufacturing supply chain central to this transition, which is why I’m proud to partner with Senator Bennet on this critical piece of legislation.”

The investment tax credit would be available until 2028, and would be established at a 30 percent rate for U.S.-based facilities that manufacture or assemble qualified onshore wind components. It would phase out entirely by the end of 2030. A separate production tax credit would range from 2 to 5 cents per watt, depending on the type of onshore wind component produced, and provide another 10-30 percent credit for related vehicles or specialty equipment designed to transport, install or help maintain onshore wind components or turbines. This would also be available until 2030.

Given the economic potential involved, Schneider has also pushed for the legislation to be enshrined with the Build Back Better Package, currently struggling its way through Congress with President Joe Biden’s blessing.

“There are over 8,000 parts in a wind turbine and every one of them should be made by American workers,” Stabenow said. “Our bill doubles down on American-made onshore wind components so more of them are made here, while also helping us address the climate crisis.”

In these efforts, the legislators have been backed by at least eight clean energy and environmental organizations, including: American Clean Power Association (ACP), Distributed Wind Energy Association (DWEA), Environmental Defense Fund (EDF), Keystone Tower Systems, Natural Resources Defense Council (NRDC), Radia, Siemens Gamesa Renewable Energy, and Vestas-American Wind Technology, Inc.

“The clean power industry strongly supports the Onshore Wind Manufacturing Act which will enable the strongest possible base of domestic manufacturing for American wind projects,” Heather Zichal, CEO of ACP, said. “Legislation before Congress right now is the single biggest endorsement of American workers, domestic manufacturing, and the climate imperative that is before us. The Onshore Wind Manufacturing Act alongside an extension of clean energy tax credits enables the ideal framework to rapidly expand domestic manufacturing for onshore wind in our country and will create good-paying jobs across the United States.”