Investment and growth in the cleantech sector has been driven in the last 2 to 3 years by the solar photovoltaic, large scale wind, and ethanol sectors. For years solar PV has, on a per kw basis relative to other technologies, received massive rebates and tax credits that underpinned its growth, and large scale wind power has had its production tax credit to anchor the industries’ rise, but solar thermal and small wind systems have been largely left out in the cold in this cleantech boom.
Perhaps that is changing for micro wind?
The CEO of Mariah Power, one of the micro wind turbine startups we follow, turned me on to a recent bill in Congress that might even the playing field for small wind. I’ve excerpted his notes in quotes below.
“Recently, Senator Ken Salazar (D-Colo.), along with Senator Gordon Smith (R-Ore.) introduced a bill that would provide $1500 per 1/2 kilowatt (kW) of capacity to customers seeking to purchase a small wind turbine, the same credit that solar is currently pursuing. In addition to this credit, the bill would provide accelerated 3-year depreciation and an Alternative Minimum Tax exemption.
A press release on this bill, S. 673, the Rural Wind Energy Development Act, can be found here.
This bill will provide an investment tax credit for the purchase of small wind systems (rated at 100 kilowatts and below) for homeowners, small businesses, and farmers. This credit is critical to sustaining the growth of this clean, renewable, and emissions-free energy technology while helping individuals and communities become more independent from unpredictable prices and supplies of traditional sources of energy.
Currently there is no federal support for small wind systems. Residential solar and fuel cell systems, however, which share the same competitive market as small wind, have been receiving a 30% federal tax credit. The federal Production Tax Credit (PTC) applies only to large utility-scale wind projects, not to individuals who want to install their own wind systems for on-site power. Federal support would help broaden the industry on a national scale.”
The growth of our cleantech and alternative energy industries have always been heavily influenced by the policy and subsidy environment, so how the debate plays out is critical to understanding where the product and investment opportunities may lie for any given clean technology.
Neal Dikeman is a founding partner at Jane Capital Partners LLC, a boutique merchant bank advising strategic investors and startups in cleantech. He is founding contributor of Cleantech Blog and a Contributing Editor to Alt Energy Stocks.