DENVER An eerie quiet has settled over the Walker Components plant, which assembles custom cables for a global wind-turbine company. Orders are down from earlier in the year and one-third of its employees have been laid off this year.
At the beginning of this year, we just didnt feel we had enough time, and now weve got too much time on our hands, said one of its workers, 25-year-old Calvin Huddleston. I really thought wind would be a sustainable business.
The wind-energy boom President Barack Obama touted as key to his energy strategy has hit a wall in an election-year dispute over taxpayer support for renewable energy.
The government poured billions of dollars into renewable energy, hoping to unleash a wave of good-paying, high-tech manufacturing jobs. But federal spending to support development of green energy has dropped sharply 75 percent since 2009 amid tea party criticism that its wasteful. Congress failure to extend past December the production tax credit, a wind-energy tax break first signed into law by Republican President George H.W. Bush, has contributed to job cutbacks from South Carolina to Washington state.
The green bubble is starting to fall apart, said Tom Borelli, a fellow at the tea party group FreedomWorks. How much longer can we fund things that are not cost-competitive?
Republican presidential nominee Mitt Romney and Obama prominently collided during the campaign over the fate of the tax credit. Romney has called for its expiration, while Obama supports its renewal. The credit stalled in Congress this summer in the face of opposition from House Republicans, and the last chance to extend it comes in Decembers lame-duck session. Amid the gridlock, Vestas, the Danish company that Walker Components supplies, closed offices and laid off hundreds of U.S. workers. Wind businesses from South Carolina to Washington state also have cut jobs.
Even some Republicans who supported extending the credit, including three of Colorados four GOP congressmen, were surprised at Romneys opposition. He argues it gave the industry an unfair advantage over its gas and oil competitors.
In one year, you provided $90 billion in breaks to the green-energy world, Romney told Obama at the first presidential debate in Denver.
Now, I like green energy as well, but thats about 50 years worth of what gas and oil receives.
The Energy Department recently found that the natural-gas and petroleum industries altogether accounted for about $2.8 billion in federal energy subsidies in the 2010 fiscal year and about $14.7 billion went to renewable energies. The figures include both direct expenditures and tax credits.
Environmentalists argue that fossil-fuel industries have been publicly supported since a young federal government levied a tariff on coal imports in the late 18th century.
Every form of energy has incentives. Were up against 90 years of incentives for other forms of energy, said Peter Kelley, a spokesman for the American Wind Energy Association. Plenty of people consider tax credits a good, Republican way of fostering business.
Sen. Mark Udall, D-Colo., said the oil industry benefits from billions of dollars in hidden subsidies, such as American troops presence near the Middle East. Were underinvesting in renewable, 21st century alternative energy, especially in comparison to the Europeans, the Chinese, even the Brazilians, Udall said.
By next year, federal spending on renewable energy will have dropped 75 percent from its 2009 high of $44.3 billion. Part of the shrinkage comes from stimulus programs ending. But part also comes from Congress not wanting to pour more funds into renewables.
Were entering a brave new world here, a definite lessening of support from Washington, said Mark Muro, a senior fellow at the Brookings Institution. Theres a substantial fiscal problem, which is real, and the need to restrain domestic budgets.