A Dry Spell for Green Energy?

With the current economic downturn, the once-booming wind and solar power industry is also experiencing quite a fall. According to an article in the New York Times, despite the promise of a green-minded Obama administration, factories building parts for wind and solar power installation have recently announced a wave of layoffs.

Without help from the government, trade groups project that installation of new equipment is set to decline by 30 to 50 percent this year. DMI Industries of Fargo, a plant that makes towers for wind turbines, recently announced a cut of about 20 percent of its workforce due to falling sales.

Before the credit crisis, almost 20 big banks and financial institutions took advantage of generous federal tax incentives by helping finance installation of wind turbines and solar arrays. Now, with banks in trouble, the number has dropped to four, according to Keith Martin, a tax and project finance specialist with Chadbourne & Parke as quoted in the Times.

Wind and solar companies are urging Congress to help revive the market by adopting new measures. According to the Times, with the stimulus bill, both House and Senate would extend an important tax credit for wind energy for three years. Meanwhile, the House version of the stimulus bill would help both wind and solar industries become less dependent on banks by providing more immediate tax incentives.

Despite the current downfall, it is hoped that Obama's interest in clean energy and green jobs would not let this industry collapse. The issue of clean energy should remain a priority so this downturn would only be seen as a brief dry spell in the long-run.