Iowa's Green Movement May Swing 2016 Presidential Election

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The wind production tax credit (PTC) is set to expire on New Years day but you wouldn't know it judging by Siemens (NASDAQOTH: SIEGY  ) recently announced 448 wind-turbine deal for 5 projects in Iowa from Warren Buffett's MidAmerican Energy. This deal is big not just because it was the largest wind turbine order ever, but rather because it shows wind has a very good opportunity to compete with natural gas even without subsidies. Throw into the mix that the deal is in Iowa, a purple state often seen as vital to winning the Presidential election, and you have a hot topic that 2016 Presidential candidates need to focus on.

With coal plants closing due to higher emissions standards, a larger move by microgrids to be powered by renewable energy and a growing need to fight climate change, it seems wind will regain much more relevance, especially as technology is making this clean energy source less expensive than building new natural gas power plants. Considering Iowa is home to blade and turbine manufacturers and presently gets a quarter of it's electricity from wind power, a figure that will jump to roughly 50% by 2015, the 2016 election may come down to Iowa. Keep in mind, at a time when they are growing their presence in wind, Iowa is also no coincidence becoming a real destination for innovation and technology. In fact, Facebook (NASDAQ: FB  ) announced in May it will build a $300mln data center in Iowa powered fully by wind, an investment that could grow to as much as $1bln by the end of the decade. So life post the expiration of the wind PTC now comes down to attracting new technology companies to the Hawkeye State, the creation of thousands of new jobs from the wind industry and new laws needed to move power across state lines, all important points which should have massive implications for this purple state. Facing these issues could help New York's Democratic Governor Andrew Cuomo if he runs for President the way he supports a more resilient New York post Sandy but New Jersey's Republican Chris Christie, another potential 2016 Presidential candidate and one-time climate change leader, should consider Iowa the next time he calls global warming a "esoteric" theory. 

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John Licata

John Licata is the Founder & Chief Energy Strategist of Blue Phoenix Inc. You can follow John on Twitter @bluephoenixinc

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