News analysis takes unduly negative slant on wind incentive
AOL Energy, as part of a "feature week on wind," devotes an article to the U.S. Treasury's "Section 1603" program, which provided a system of cash payments in lieu of federal tax credits to wind farm developers during the economic meltdown.
The story of criticism of the program was first broken more than a year ago and picked at during the 2010 elections. We spent quite a bit of time responding to it then (see American Wind Energy Association response to Investigative Reporting Workshop story on wind tax incentive, October 21, 2010).
To be fair, the AOL Energy story includes most of the correct information on why the program was justified, and what it accomplished. Still, by journalistic standards, it's slanted, and here's why:
1) There are many more current, newsworthy stories out there. There are many trade publications, on- and offline, covering the wind power industry today, and there are dozens of other interesting stories to write that are actually news, from technology innovations in offshore wind and utility wind integration to the growth of community-owned wind projects and more.
2) The headline is prejudicial.
3) The reasons for the 1603 program are not explained until ... wait for it ... wait some more ... paragraph 11.
From paragraph 11 on, there is some good stuff, for any readers still paying attention. For example, it quotes Jan Johnson, communications director for wind farm developer Iberdrola Renewables: "[The 1603 program] was essential when the 2008 financial crisis wiped out the market for monetizing tax credits, leaving wind companies that were in the midst of building multi-million dollar facilities stuck with a decision to shut down construction and lay off workers or continue projects and take huge financial losses." And Vic Abate, Vice President of GE Renewable Energy, as saying that the meltdown would have seriously disrupted the wind industry if the 1603 program had not been enacted.
And in the final paragraph, paragraph 26 by my count, Richard Caperton of the Center for American Progress points out that as far as the taxpayers are concerned, there is no difference between a tax credit not paid to the Treasury (which is what happens under the existing Production Tax Credit) and a cash payment made by the Treasury (which is what happens under 1603).