US President Donald Trump’s questioning of the wind sector at a rally in Iowa last week has highlighted uncertainty over government policy in the industry.
Speaking to a crowd in Cedar Rapids, Trump said the US would take advantage of all forms of energy but then singled out wind for criticism.
“I don’t want to just hope the wind blows to light up your homes and your factory,” Trump said.
His comments came in a state that the president won by a 9.5 percent margin in last November’s election, but also one that has become a national leader in wind production. Iowa ranks second in the US with nearly 7GW in installed wind capacity, with wind providing 36.6 percent of in-state energy production, according to data from the American Wind Energy Association.
Trump has long questioned the value and reliability of renewable energy sources while vowing to boost the coal industry by lifting environmental regulations. His decisions to exit the Paris climate agreement and scrap his predecessor’s Clean Power Plan have reflected this view, while a review of the electricity grid ordered by the energy department is also expected to target wind and solar.
With support for renewables still solid on the state level, the impact of changes in federal policy may be limited. Though federal production tax credits still help drive renewables output, those credits are scheduled to be phased out over the next five years. Gregory Remec, a senior director for Fitch Ratings’ global infrastructure group, said there is a small chance Trump will look to cancel these credits immediately.
“From a political standpoint it is very unlikely that that would happen because there is so much bipartisan support for wind,” Remec told Infrastructure Investor. “I don't know that there are a lot of levers that he could pull at this point that would have a significant impact on where wind is going and how it will continue to operate.”
REPUBLICAN PUSHBACK
Still, Remec said, policy uncertainty has contributed to a sense of urgency for developers of renewables projects. And a report issued by Standard & Poor’s following Trump’s decision on the Paris deal warned that the withdrawal could have “profoundly negative implications” for renewable energy generators.
While the administration has taken a sceptical view towards renewable sources, Republicans in states like Iowa that have benefited from the wind sector have at times pushed back. Senator Chuck Grassley, an Iowa Republican, sent a letter last month to Energy Secretary Rick Perry in response to the energy review. The letter touted the “enormous economic contributions wind energy is already providing in many parts of the country”.
In March, for the first time, wind and solar topped 10 percent of US electricity generation, with wind power comprising 80 percent of this total.
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