Wind Energy Fight! Tom Corbett vs. Katie McGinty

A representative for Gov. Tom Corbett says Democratic gubernatorial candidate Katie McGinty misrepresented the governor’s positions on renewable energy during a recent interview with Philadelphia magazine.

In that interview, McGinty was questioned about why she blamed Corbett for the closing of Gamesa, a wind engine turbine plant in Cambria County. Her response:

This governor actively worked against good manufacturing jobs in his own state in two ways. One, becoming one of the only governors to oppose extension of the federal production tax credit for renewable energy, and to stand against bipartisan legislation here in Pennsylvania that would have expanded the market for renewable energy. And in the face of that aggressive and hostile set of actions by the governor, the company had to shut down. And hundreds of good manufacturing jobs were lost. … It was unacceptable to say the least.

Patrick Henderson, Corbett’s deputy chief of staff and point man on energy issues, told Philly Mag this week neither claim was true — the governor neither opposed wind tax credits, nor did he oppose legislation. McGinty’s claims, he said in an email, “demonstrate a propensity by Ms. McGinty to not be confined to what all Pennsylvanians ought to be able to expect of their leaders: telling the truth.”

Let’s break it down:

• On tax credits, McGinty’s comments appear to reflect a statement attributed to Henderson himself a year ago, telling Pittsburgh Business Times why Gov. Corbett had not signed a letter from the Governors Wind Energy Coalition — one of several letters to the White House that went without Corbett’s signature.

All of these letters had a variation on a theme: Support the production tax credit that has given wind development a boost.

Corbett disagrees with that philosophically, Henderson said Tuesday and, more practically, he decided not to ask the federal government for more funding allocations while it tries to balance its budget.

But Henderson says that article was incorrect: The Corbett Administration didn’t oppose the tax credits — instead, intending to avoid comment either way on the matter. “We viewed the federal (tax credits) as a federal budgetary issue — and our position across the board was not to weigh in on budgetary allocation issues at the federal government, as they faced an even bigger deficit than the states, unless Pennsylvania was disproportionately impacted,” he said in an email. “We also believe policies like the state AEPS are better incentives at the state level since it can drive interest to one state vs another.”

Indeed, this is consistent with another Pittsburgh Business Times report from 2011:

The American Renewable Energy Production Tax Credit Extension Act of 2011 also would extend the same credit for biomass, geothermal, small irrigation, landfill gas, trash and hydropower projects. Their subsidies are scheduled to expire in 2013.

A similar letter was signed by 23 of the 26 state governors in the Governors Wind Coalition, but Gov. Tom Corbett pulled his name from that list.

“Given the tremendous challenges Congress faces in closing the national budget deficit, and its need to look at all programs which affect the federal budget, we have not taken a specific position on this legislation,” said Eric Shirk, a spokesman for Corbett.

Conclusion: Corbett did not support federal tax credits for wind energy production. But neither, it appears, did he actively oppose them.

• On the second claim, regarding the “bipartisan legislation here in Pennsylvania that would have expanded the market for renewable energy,” McGinty’s camp points to HB 1580, a 2011 bill, that “would increase the number of solar energy credits utilities are required to buy and mandate they purchase those credits from Pennsylvania sources.”

The governor submitted a letter that appears to oppose the bill:

“The Energy Association of Pennsylvania, which represents the electric distribution companies subjected to the AEPS Act, estimates this cost at more than $2 billion through 202 1. Without question, it is a significant amount that wouId be directly passed on to the employers and ratepayers of Pennsylvania. Indeed, if HB 1580 did not result in a substantial increase in SREC prices, it would not accomplish its stated public policy goal of incentivizing, and therefore encouraging, additional deployment of solar projects throughout the Commonwealth. I do not support increasing costs on Pennsylvanians through additional government mandates. “

Henderson’s comment: “The Governor was asked by the House committee to lay out his concerns/views w HB 1580. We did not oppose it — quite the contrary we outlined in explicit detail the policy concerns contained in the bill — including the constitutionality concerns of in-state credits — and a willingness to engage in discussions. And we did just that. On behalf of the governor, I led a series of meetings with business reps and solar industry representatives to work on common ground. We even floated several specific compromises for consideration. Bottom line — we showed the leadership of actually engaging in dialogue and trying to bring parties together on the issue.”

Conclusion: Actually, it’s probably fair to question why McGinty linked this specific legislation to the closing of Gamesa—HB 1580 involved solar energy, something that had nothing to do with Gamesa’s wind energy business.

But Corbett was certainly opposed to some elements of the bill, so that by Henderson’s account the entire bill was derailed into negotiations that tried to produce an alternative. The attempt to produce a positive result from that opposition doesn’t mean the opposition didn’t occur; we’ll let the public judge whether opposing elements of the bill is the same as opposing the whole of it.

• The unanswered question, perhaps, in all of this: Did Tom Corbett policy actually help bring about Gamesa’s closure?

McGinty, who helped lure the company to Pennsylvania when she served as Ed Rendell’s secretary for the Department of Environmental Protection, has made the case on several occasions.

But Gamesa’s own explanation, and the broader failure of its business outside the state, suggest the problem is not Corbett-specific.

Gamesa said Tuesday that closing the Ebensburg plant was prompted by a shift in the market from Pennsylvania and the Midwest to the Southwest. The giant lades will now be supplied from other plants.

Gamesa and other renewable energy companies have taken advantage of federal and state tax credits (like the ones that brought it to Bucks County) in recent years, but the businesses suffered when those credits dried up.

The company is now downsizing across the globe, shutting 24 offices and cutting 2,600 jobs. The Fairless Hills plant, which once manufactured turbines and other components, is now primarily a warehouse and its future is in question.

A federal production tax credit, which provided wind generators with 2.3 cents per kilowatt hour for 10 years, sparked a frenzy of construction before it expired at the end of 2012. The tax credit was restored through the end of 2013 but failed to generate new development.

Conclusion: Gov. Tom Corbett might be more interested in promoting Pennsylvania’s fossil fuel resources than in alternative energy, and that leaves plenty to debate. “Downsizing across the globe,” however, suggests Gamesa’s problems are too widespread to dump on the governor’s lap.