Funding Wind Power

Despite its growth, and promise of clean, renewable power, wind energy still falls short of becoming a conventional energy source rather than an alternative one. Wind energy only makes up 1 percent of electricity generated in the United States.

To lure potential investors for wind energy projects, wind farm developers rely on federal tax credits. Since turbines are business investments, they can often bring substantial tax savings to their owners. The federal government currently offers a 1.9 cent/kWh tax credit for energy generated by wind turbines, available for projects installed by December 31, 2007 for the first ten years of operation. The tax credit is adjusted annually for inflation, so it will rise over time. This provides a nice incentive to both investors, and land owners who allow wind farms to be built on their property.

While there is no guarantee that any projects completed after 2007 will receive those tax credits, energy consultants like Bruce Bailey is confident some kind of subsidy will be available after 2007. Bailey, who is president of AWS Truewind LLC in Albany, New York, believes that lawmakers are looking very hard at alternative energy sources as a way to reduce US dependence on foreign oil. With the success of past projects, and the promise of new ones, the government won't likely let this tax credit program expire without an extension.