Brown Announces Bipartisan Legislation To Encourage Offshore Wind Energy Production

Legislation Follows Brown’s Procurement of $4 million in Critical Federal Funds For First-In-The-U.S. Offshore Wind Development In Lake Erie

WASHINGTON, D.C. – U.S. Sen. Sherrod Brown (D-OH) today announced bipartisan legislation to provide critical financial incentives for the investment and production of offshore wind energy. Cosponsored by a group of bipartisan senators, the Incentivizing Offshore Wind Power Act would provide the offshore wind industry with enhanced stability through an investment tax credit for the first 3,000 megawatts (MW) installed. These provisions are vital because of the long lead times required to permit and construct offshore wind turbines, compared to onshore wind energy. The legislation follows Brown’s December announcement that the Lake Erie Energy Development Corporation (LEEDCo) was awarded $4 million in new federal funds to advance a first of its kind offshore wind development in Lake Erie.

“Offshore wind energy could not only bring thousands of new manufacturing jobs to our state, but would also provide renewable, clean energy for Ohio,” said Brown. “With the right tax incentives, we can position Ohio to lead the nation in clean energy manufacturing, solidifying our state’s leadership in research, development, and commercialization of wind power. I will continue to work to make Ohio the center of that innovation.”

“Offshore wind is a $200 billion international industry that has huge growth potential in Ohio,” said LEEDCo President Lorry Wagner. “Smart incentives for the industry will help reinvigorate Ohio’s economy and create thousands of permanent jobs in our region.”

Recognizing the longer start-up time for offshore wind compared to onshore wind, Senators Tom Carper (D-DE) and Susan Collins’s (R-ME) legislation would amend Section 48 of the Tax Code by creating an investment offshore wind tax credit for the first 3,000 MW offshore wind facilities placed into service. The legislation would:

  • Require the Secretary of Treasury to consult with the Secretaries of Energy and Interior when establishing the credit;
  • Provide a 30 percent tax credit on the investment in offshore wind for the first 3,000 MW generated;
  • Give Treasury the authority to make final decision on who is awarded the tax credit. Once a credit is awarded, companies would have five years to install the wind facility;
  • Prohibit companies from receiving other production or investment tax credits in addition to the offshore wind investment tax credit created under the bill; and
  • Define offshore facility as any facility located in the inland navigable waters of the United States, including the Great Lakes, or in the coastal waters of the United States, including the territorial seas of the United States, the exclusive economic zone of United States, and the outer Continental Shelf of the United States.

Brown first cosponsored the legislation in March 2010 and has been a longtime advocate of offshore wind energy.

Last December Brown secured $4 million in critical federal funds to advance offshore wind development in Lake Erie. LEEDCo was awarded key resources from the U.S. Department of Energy (DOE) to establish an offshore wind demonstration project on Lake Erie, the first project of its kind in North America. The DOE selected seven projects that will accelerate the commercialization of innovative offshore wind technologies in the United States. Each project received up to $4 million from the Energy Department to complete the engineering, site evaluation, and planning phase of their project. Upon completion of this phase, the DOE will select up to three of these projects to advance the follow-on design, fabrication, and deployment phases to achieve commercial operation by 2017. These projects will be eligible for up to $47 million over four years, subject to Congressional appropriations.

Brown led a letter in May 2012 signed by several members of the Ohio Congressional delegation, supporting LEEDCo’s application for the grant program. In July 2011, Brown attended an Offshore Wind Industry Roundtable, hosted by NorTech in Cleveland, and fought for funding to support offshore wind in Lake Erie that was announced in February 2011.

In 2010, Brown convened a high-level meeting with LEEDCo, its partners, the U.S. Army Corps of Engineers, DOE, and the Council on Environmental Quality on permitting challenges and questions. He urged the Obama administration to strongly consider establishing the country’s first demonstration wind project in Ohio. That same year, Brown introduced the Program for Offshore Wind Energy Research and Development (POWERED) Act of 2010 which would bolster offshore wind projects, expand incentives for offshore wind development, and require the DOE to develop a comprehensive roadmap for the deployment of offshore wind. Brown’s POWERED Act was endorsed by The University Clean Energy Alliance of Ohio, Case Western Reserve University, The University of Toledo, Bowling Green State University, The Ohio State University, The Great Lakes Wind Network, and by wind developers like NRG Bluewater Wind.

In the 111th Congress, Brown was also an original cosponsor of S. 3062, legislation that would have provided the offshore wind industry with enhanced stability by extending production and investment tax credits for offshore wind until 2020. These provisions are vital because of the long lead times required to permit and construct wind turbines offshore, compared to onshore wind energy.

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