U.S. House backs tax break crucial to wind turbine makers

Reuters News
|
Posted: Dec 04, 2014 3:10 AM

COPENHAGEN (Reuters) - The U.S. House of Representatives voted on Wednesday to renew a package of temporary tax breaks, known as the "extenders", including a wind production tax credit (PTC) crucial for turbine makers such as Denmark's Vestas.

The PTC will be extended for one year retroactively for 2014 if the Senate and President Barack Obama concur.

"People were expecting a two-year extension, so this is less than expected," Nordea analyst Patrik Setterberg said in a note to clients.

However, he said the Senate had previously argued it wanted a two-year tax package, leading him to conclude the final deal could still change.

"The outcome in the Senate and the final details of the extension, which are expected at a later stage, will decide whether it is a good or bad deal," Setterberg said, adding it was too early to estimate the potential impact on company results.

Sydbank analyst Jacob Pedersen had previously said shares in Vestas, the world's biggest wind turbine maker, could outperform the market by more than 10 percent within a week or so if the PTC was extended.

General Electric, Siemens, Gamesa and Suzlon are also active in the U.S. wind power industry, home to almost 20 percent of the world's installed turbines.

(Reporting by Teis Jensen; Editing by Mark Potter)