Reacting to the news, Arkansas Governor Mike Beebe said that is was Congress’s failure to approve a long-term extension to the Production Tax Credit that led to Nordex’s decision to stop production in Jonesboro. “This is directly related to Congress’ inability and dysfunctionality to be able to follow through on a policy they started, and now they can’t get together and come to an agreement,” Beebe said in an interview with the Arkansas News Bureau.
The state has been aggressively recruiting wind energy companies since LM Windpower built a $150 million plant in Little Rock. That led to parts and supply companies, such as Nordex and Beckman-Vollmer building plants in Jonesboro and Osceola.
First established in 1992, Congress has been renewing the PTC yearly since and it was renewed until 2014 during fiscal cliff fiasco. However, development of new technologies in renewables have a long timeframe and the uncertainty of extensions of the PTC has kept investment in new technologies at minimum. Most growth in the industry has come from projects already on the books that can be completed before the next expiration date.
The tax credit lets companies producing renewable energy pay a lower income tax rate by 2.2 cents per kilowatt-hour.
Now new investors are pulling back. Mitsubishi Industries has stopped construction of a $100 million wind turbine manufacturing plant in Fort Smith, and
LM Wind Power, laid off 234 workers at its plant in Little Rock.
Scott Sines
