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Analysis - PTC phase-out is only "one policy option" says AWEA

UNITED STATES: A phase-out of the production tax credit (PTC) remains on the table, but comprehensive tax reform is "not moving" in Congress, according to the American Wind Energy Association (AWEA).

Upcoming AWEA CEO Tom Kiernan
Upcoming AWEA CEO Tom Kiernan

In fact, the trade association says it has never actually advocated the phase-out, despite press reports to the contrary.

The idea of a phase-out came about after requests from Capitol Hill for input on tax reform, said Peter Kelley, AWEA’s vice president for public affairs. But comprehensive tax reform is not moving in Congress, said Kelly.

The phase-out is "one policy option", said Rob Gramlich, AWEA’s interim CEO, in an interview that included the trade association’s newly named CEO, Tom Kiernan.

AWEA had floated the idea of phase-out in December, describing it as what would be needed "to keep the industry minimally viable" over the next few years. Analysts see the odds of a PTC extension beyond December as slim.

AWEA expelled utility member Exelon Corporation last year for campaigning against the PTC. More recently, a senior executive of utility Xcel Energy described AWEA's PTC stance as "militant" and said it was reviewing its membership.

Asked how he will represent all AWEA members given the much-publicised fractures, Kiernan said: "It is critically important we craft a comprehensive long-term strategy that brings together the industry and moves [it] forward."

On the challenges facing American wind — job losses, diminishing installations and a shrinking supply chain — Kiernan called for a "smooth transition to a policy environment that is predictable, where wind can achieve its full potential".

Kiernan, long-term president of the National Parks Conservation Association, described his most recent background as the "conservation community".

He also has an MBA and was appointed by the first President George Bush to a senior role at the US Environmental Protection Agency, where he helped implement Clean Air Act regulations and was known for reaching consensus with businesses and environmentalists. At accounting firm Arthur Andersen, he worked with telecommunications company US West.

Kiernan takes AWEA's helm on 28 May. In the first quarter of 2013, AWEA spent $330,000 on lobbying on the PTC, master limited partnerships and other issues.

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