Wind Power Changes Iowa Landscape In Multiple Ways
Despite their frustration with Congress, some farmers are relieved, but not because of the money they make on their crops. In part of the fiscal cliff deal, Congress extended a tax credit that benefits the wind energy industry. And that is today’s bottom-line in business. The landscapes of Midwestern farm states have changed dramatically, due to wind power.
As NPR’s Sonari Glinton reports, wind has also changed the landscape economically and politically.
SONARI GLINTON, BYLINE: Iowa has a lot to be proud of, and it’s not just the state fair – awesome as it is – or amber waves of grain.
KIRK KRAFT: Iowa is so proud of our wind industry, that we actually promote it right on our drivers’ license.
GLINTON: Kirk Kraft is with RPM Access, a small wind energy startup that puts wind turbines on farmland in Iowa.
KRAFT: The new drivers’ licenses have a small wind turbine right on our license. And…
GLINTON: Oh, can I see? Can I see? Do you have yours on you?
KRAFT: Sure. Yeah. Right there.
GLINTON: Before Kraft was in the wind business, he was the mayor of Clear Lake, Iowa. He says wind energy can mean big money for small towns.
KRAFT: Because we pay property tax on our turbines, and by definition, we’re in rural counties, because we need space. And lots of times, we’re the largest property tax payer in the county when we get up and running.
GLINTON: The federal tax credit makes wind energy more competitive with other sources of power, in part because it helps make the most expensive part of the process cheaper: putting up the wind mills. But once they get up and going, wind energy companies then pay farmers rent for the land around every windmill. And after putting money in farmers’ pockets, the companies turn around and pay local government fees and taxes.
GUY RICHARDSON: We’ll probably see tax revenues of in the neighborhood $700,000 a year for the next 20 years.
GLINTON: Guy Richardson is a county supervisor in Greene County, Iowa.
RICHARDSON: So that’s going to generate $14 million worth of tax income to the county, which is huge for a county our size. We’re a county of under 10,000 people.
GLINTON: The tax credit was set to go away at the end of last year. But as part of the fiscal cliff deal, Congress extended the credit for another year. It’s estimated that just that one year will cost the government about $12 billion.
Critics of the subsidies point out that wind is intermittent. You only get power from the wind when it blows, and wind power remains expensive when compared to other forms of energy.
Thomas Pyle is with the American Energy Alliance. His group has encouraged the end of the production tax credit.
THOMAS PYLE: It’s not that the subsidies for the wind industry in and of themselves are bad, but it is part-and-parcel of a larger problem, and that is, is that the federal government is notoriously bad at energy policy. They have been for decades, and we think it’s time for them to step aside.
GLINTON: The tax credits have garnered bipartisan, but not universal support.
Iowa’s Republican Senator Chuck Grassley helped write the law that provides the credits, and many other Republican officials support wind energy, as well as the president. Wind energy companies lobbied hard to get the tax breaks extended. Again, Thomas Pyle.
PYLE: If they had spent their millions and millions of dollars to get their billions and billions in subsidies on figuring out how to make wind work in the marketplace in a more effective way these past 20 years, I think that they would be in much better shape for the next 20 years.
GLINTON: Wind proponents concede that there’s not likely to be the political will to sustain the credits indefinitely. Meanwhile, many farmers have come to depend on wind energy.
ROYAL HOLZ: Farmers are always watching the weather. We used to watch the visor on the barn and on the corn crib and other things. And so now we watch them on the windmill.
GLINTON: Royal Holz is a third-generation corn farmer in Grand Junction, Iowa. Now he’s got wind turbines on his farm. Just one windmill can give a farmer like Holz more than $8,000 a year.
HOLZ: Well, I just think of it as my 401k. Or farmers don’t usually retire, but something for the future and just a little supplemental.
GLINTON: If Congress takes up comprehensive tax reform, the production tax credit is likely to be among the first to go. But wind energy advocates say they need just a few more years for the industry to stand on its own.
Sonari Glinton, NPR News.