[Congressional Record Volume 147, Number 172 (Wednesday, December 12, 2001)]
[Senate]
[Page S13053]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. DURBIN:
  S. 1810. A bill to amend the Internal Revenue Code of 1986 to provide 
credits for individuals and businesses for the installations of certain 
wind energy property; to the Committee on Finance.
  Mr. DURBIN. Madam President, today I am pleased to introduce the Home 
and Farm Wind Energy Systems Act of 2001. At a time when the United 
States clearly needs to reduce its dependence on fossil fuels, and 
particularly on imported oil, I offer legislation to spur the 
production of electricity from a clean, free and literally limitless 
source, wind. My bill offers a tax credit to help defray the cost of 
installing a small wind energy system to generate electricity for 
individual homes, farms and businesses. It is my hope that this credit 
will help make it economical for people to invest in small wind 
systems, thereby reducing pressures on the national power grid and 
increasing America's energy independence one family or business at a 
time.
  Any serious attempt to create a national energy policy must include 
innovative proposals for exploring and developing the use of 
alternative and renewable energy sources. I look forward to debating a 
comprehensive energy policy for America in the next session of the 
107th Congress, and I ask unanimous consent that a summary of the Home 
and Farm Wind Energy Systems Act of 2001 be printed in the Record.
  There being no objection, the summary was ordered to be printed in 
the Record, as follows:


          Summary of the Home and Farm Wind Energy Systems Act

       The bill would provide a 30 percent federal investment tax 
     credit for homeowners, farmers and businesses when they 
     install small wind energy systems with a capacity of up to 75 
     kilowatts (kW). The tax credit would be available for 
     installation occurring over the next ten years.
       Investments in renewable energy provide many benefits, 
     including:
       1. Enhancing the energy security and independence of the 
     United States;
       2. Increasing farmer and rancher income;
       3. Promoting rural economic development;
       4. Providing environmental and public health benefits such 
     as cleaner air and water;
       5. Improving electric grid reliability, thereby reducing 
     the likelihood of blackouts;
       6. Providing farm and residential customers with insulation 
     from electricity price volatility resulting from electric 
     deregulation.
       Small wind systems are the most cost-competitive home sized 
     renewable energy technology, but the high up-front cost has 
     been a barrier. Phil Funk, for instance, a farmer in Dallas 
     County, IA, invested $20,000 in a 20kW wind turbine system 
     that saves him $3000 dollars per year on his electricity 
     bill. Funk made use of an existing tower on his property to 
     reduce his total costs significantly. The simple return-on-
     investment period for Funk, however, was still 7 years--too 
     long to interest many farmers. A 30 percent tax credit would 
     be a powerful incentive in its own right. It would also bring 
     down production costs for small wind systems by increasing 
     sales and production volume.
       A typical rural residential wind system uses a 60 foot to 
     80 foot tower, has a 10 kW capacity and costs $30,000 to 
     $35,000 to install. It produces up to 13,000 kWh of 
     electricity per year, and offsets seven tons of carbon 
     dioxide per year. This could yield savings of $1000 or more 
     per year in energy costs, depending on prevailing commercial 
     rates. In addition, in most states, system owners whose homes 
     are connected to the power grid can sell excess electricity 
     back to the local power company, improving efficiency and 
     further reducing demands on local power grids.
       While a few states offer incentives, the Federal Government 
     has not offered tax credits for small wind systems since 
     1985.
       A recent USA TODAY/CNN/Gallup poll showed that 91 percent 
     of the public favors incentives for wind, solar, and fuel 
     cells. But, while there are tax credits for very large 
     commercial wind turbines, Production Tax Credit, there is 
     currently no federal program to support small systems.
       According to the American Wind Energy Association, Illinois 
     ranks 16th in the contiguous states for wind energy 
     potential. A new map produced by the National Renewable 
     Energy Laboratory, NREL, for the U.S. Department of Energy 
     indicates that over 2/3 of Illinois has a ``class 3'' or 
     better wind resource, making rural areas and the higher 
     elevations in those areas appropriate for small wind turbine 
     siting.
       Illinois has a strong wind energy heritage. Chicago and 
     Batavia were the leading centers of wind energy manufacturing 
     in the United States at the end of the last century, with 
     millions of farm water pumping windmills and battery-charging 
     wind turbines built in the area between 1870 and 1910. 
     Batavia is still known as ``The Windmill City''.
       In 1999, the Danish large-wind-turbine manufacturer NEG 
     Micon chose Champaign for the site of its first American 
     assembly and servicing facility, continuing the wind energy 
     tradition in Illinois.
       Only a handful of States provide incentives for small wind 
     systems.
       Illinois currently offers a buy-down or rebate on the 
     purchase of wind energy systems of up to 50 percent or $2/
     watt. Eligible applicants include associations, individuals, 
     private companies, public and private schools, colleges and 
     universities, not-for-profit organizations and units of State 
     and local government. Potential recipients must be located 
     within the service area of an investor-owned or municipal gas 
     or electric utility or an electric cooperative that imposes 
     the Renewable Energy Resources and Coal Technology 
     Development Assistance Charge. Grant payments under current 
     operating procedures are, however taxable, which reduces 
     their value significantly.
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