Passage of the law that kept the nation from falling off the fiscal cliff also could help attract private investment in an offshore wind project in Lake Erie.
The legislation included federal incentives for wind power — the renewable energy production tax credit and the offshore wind investment tax credit. The credits expired on Dec. 31. Julian Boggs of Environment Ohio said the renewed credits will be available for wind power projects that start construction this year.
Lorry Wagner, president of the Lake Erie Energy Development Corporation, said that while details of the renewed credits are unknown, it should bode well for the LEEDCo project off Cuyahoga County. The plan is to build between 20 and 30 megawatts of generating capacity in Lake Erie. The wind farm would serve as a model for future investment in offshore energy in Lake Erie.
The demonstration project is of interest to Ashtabula County, which, as a member of LEEDCo, shares in profits from the project. Further, some of the best wind in the lake is found off Ashtabula County. Commissioners say offshore wind farms could spur regional economic development if the area can become a supply chain for the massive towers, rotors and other components. The county’s ports could provide a base for maintenance workers and equipment as well.
Late last year, the Department of Energy announced that the LEEDCo project will receive a $4 million grant. Being selected for the award also puts the project in line for future grants, spread out over five years. Wagner said that the grants mean the project will have to be built according to the DOE’s time frame, most likely completion in 2016 and implementation in 2017.
Thus, the project won’t be eligible for the production tax credit this year, but it could meet the criteria for the investment credit. The credit would be of interest to a private firm which invests 5 percent of the project cost during 2013. Wagner estimated that would amount to about $7 million.
“This certainly has the potential of making a difference for us,” Wagner said.
The investor would claim the credit once the project is completed. Wagner said examples of the activities that could qualify for the credit this year are a down payment on a turbine or paying for permits — “as long as it is real money being put into the project,” he said.
Wagner said LEEDCo’s main concern is to get a contract signed with the Department of Energy so the money can start flowing. After that, it will be a matter of lining up contractors to work on the project, which has the potential of making Ohio’s lake shore counties the center of a new industry.
Nearly 6,000 Ohioans are directly or indirectly employed by the state’s wind industry. Ohio ranks fourth in the nation in wind industry employment, according to the National Wildlife Federation.
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