Tax Credit Affects on the Wind Power Sector

Nowadays, more and more countries are going to use wind power due to its potential to offer clear energy on a continuous basis. It is estimated that in the US, it would account for one-fifth of the country’s electricity demand by 2030. Advancement in technical know-how, along with the subsidies offered by the government, this power sector has gone through tremendous growth in recent years. There has also been a sharp decline in the cost of production of electricity from wind energy.

But American companies will also face stiff competition in future, especially from Chinese manufacturers. The Chinese companies are able to market their products at a much cheaper price, which, of course, has been a bone of contention between China and the US. The steel turbines manufactured by Chinese companies were slapped with tariffs by the United States Commerce Department after it was revealed that they were being sold below their actual cost of production.

China has established its dominance in the wind power sector and manufacturing companies worldwide are finding it difficult to compete with Chinese manufacturers of wind turbines. At present, the situation has come to a pass, where the country’s manufacturing capacity has outgrown its own demand.

The American turbine manufacturers are also concerned about the waning of the demand of electricity at home. And the expiration of the tax credit on 31st December, 2012 will make the American Wind companies wary of making further investment for the production of wind power. The tax credit that puts a burden of about one billion dollars on the exchequer every year is ratified by the Congress from time to time. But the announcement of its stoppage has brought apprehension that it would badly affect the growth of the wind power sector and the

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