Wind Study

Overlapping wind energy initiatives spark claims of waste, as IRS increases tax credit

by  |  published on April 10, 2013

A recent government report shows billions in taxpayer dollars are being swept away by pricey wind energy initiatives that often overlap, even as the IRS moves to up the value of a popular tax credit.

The Government Accountability Office recently identified 82 federal wind-related initiatives implemented by nine agencies in fiscal year 2011. The nearly seven dozen initiatives were fragmented across agencies and had overlapping characteristics, and several that financed deployment of wind facilities provided some duplicative financial support, the report found.

Sixty-eight of the 82 programs overlapped with at least one other initiative “because of shared characteristics,” the 95-page report found. The five agencies that had the most initiatives, and therefore were looked at closest, were the Departments of Energy, the Interior, Agriculture, Commerce and Treasury. Those five departments collectively implemented 73 of the 82 proposals examined by the GAO.

Wind energy has been the fastest-growing source of U.S. electric power generation for a decade. The increase in demand has exposed several weaknesses in the chain of funding wind energy-related government projects.

“This labyrinth of overlapping programs has spawned a system in which a single wind project could have siphoned public funds from numerous federal and state programs,” Daniel Simmons, director of state affairs at the Institute for Energy Research, wrote in U.S. News & World Report. “These include a Section 1603 grant, accelerated depreciation, a DOE loan guarantee, state tax incentives, and indirect subsidies from a state Renewable Portfolio Standard. Adding to the waste, GAO reports that states often design their initiatives to skirt double-dipping laws.”
Simmons also said the lack of transparency is one of the biggest problems associated with the wind initiatives.

“The federal government should get out of the business of betting taxpayer dollars on energy projects and instead let the American (people) vote with their pocketbook on which projects should succeed,” he said.

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