The Biden administration introduced Friday it’s proposing extending a tax credit score to spice up offshore wind power initiatives, based on Politico.
The tax credit score proposal is meant to defray rising rates of interest and excessive metal costs which have made offshore wind power initiatives dearer, Politico reported. [emphasis, links added]
The Treasury Department clarified that undersea cables that join wind farms to the ability grid are eligible for tax credit as a result of Inflation Reduction Act, according to E&E Information.
The Treasury Division’s proposal would make the initiatives eligible for a 6% base credit score, and corporations might get further credit for assembly different standards, together with paying “prevailing wages,” finding the initiatives in sure communities, and utilizing home supplies, E&E Information reported.
Orsted, a Danish offshore wind power firm, announced it might terminate two wind farms being constructed off the coast of New Jersey on Oct. 31 after mounting financial difficulties.
“Macroeconomic components have modified dramatically over a brief time frame, with high inflation, rising interest rates, and supply chain bottlenecks impacting our long-term capital investments,” Orsted Americas CEO David Hardy mentioned concerning the resolution to halt the initiatives. “Consequently, we now have no alternative however to stop growth of Ocean Wind 1 and Ocean Wind 2.”
Different main corporations concerned in offshore wind manufacturing, together with Siemens and General Electric, have both introduced expectations of losses or have sought emergency funding.
Over $7 billion has been invested in offshore wind projects since President Joe Biden signed the Inflation Reduction Act into legislation in August 2022, according to the White Home, which is seeking to decarbonize the United States economy by 2050.
The Biden administration can also be investigating whether or not offshore wind farms are inflicting unusual death rates amongst humpback and right whales reported by the National Oceanic and Atmospheric Administration (NOAA).
An Aug. 29 offshore wind lease sale within the Gulf of Mexico flopped when solely one of many three areas drew any bids. The ensuing sale might present sufficient electrical energy for 450,000 properties, lower than 50% of what the Biden administration had projected all three of the areas might generate.
High picture by Reegan Fraser by way of Unsplash
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