Energy:

If you want our sunshine, you may have to pay extra

Assembly bill would tax renewable energy exported from Nevada

Chris Morris

By Alexandra Berzon (contact), David McGrath Schwartz (contact)

Tuesday, March 24, 2009 | 2 a.m.

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Small-scale solar seeks incentives (3-16-2009)
State giving up $500,000 per job in renewables (3-10-2009)
State faces obstacles to cashing in on the sun (3-9-2009)
Nevada lagging in the race to a green future (2-8-2009)

The full text of Assembly Bill 522 and history of the bill

Archive of Sun politics stories

Carson City — On one side, renewable energy companies argue Nevada needs tax incentives to attract the industry to the state.

On the other, a group of lawmakers question the long-term benefit of giant solar projects generating energy largely for out-of-state customers.

Assemblywoman Marilyn Kirkpatrick, D-North Las Vegas, has decided a tax on renewable energy would ensure the state benefits from its abundant sunshine.

“In order for the renewables (developers) to get the tax abatements, they will have to support a fee for a long-term benefit for Nevadans,” Kirkpatrick said Monday.

Kirkpatrick’s Assembly Bill 522, introduced Monday, would extend tax abatements for renewable energy projects, while taxing renewable energy per kilowatt hour.

The tax would initially pay to operate a new Nevada Energy Commission. The agency would regulate renewable energy projects and replace the Energy Office, currently overseen by the governor.

Kirkpatrick said as the state’s renewable energy industry grows, some of the tax revenue would be directed to a fund to reduce Nevadans’ electricity bills and pay for rebates to encourage homeowners to convert to renewable energy systems.

The measure would also require that 30 percent of the materials used in the construction of a renewable energy project be purchased in Nevada.

The legislation is likely to face fierce pushback from renewable energy developers and advocates, who argue that Nevada needs to lower barriers to such projects to remain competitive with neighboring states offering incentives for renewable energy projects.

Rose McKinney-James, head of the solar advocacy group Solar Alliance, said she had yet to review the bill. But “I’d be reluctant to support any additional burden on renewable energy,” she said.

Some have suggested that a tax on renewable energy would kill the industry in Nevada.

But Kirkpatrick said developers could make the added cost work if they build it into their business models.

“We have 55 renewable energy projects being proposed right now,” she said. “We’re looking to set the rules in the beginning.”

As for the argument that some projects would go elsewhere, she said: “If we get them, we get them. At a certain point, we need to look at what’s in the best interest of Nevada.”

Supporters of a tax on renewable energy say that if most of the revenue comes from energy consumed outside Nevada, it could engender more support in the state for the solar and geothermal energy industries. Otherwise, they say, renewable energy companies could face a backlash from residents who expect them to contribute more to the state.

Charging California energy users who have committed to paying higher energy bills could be one solution, they say.

“The question is: Can Nevada use renewable exports to generate income for the state, the same way that Alaska uses oil exports and Wyoming uses coal exports?” said Charles Benjamin, Nevada director of Western Resource Advocates. “Can it be done so it doesn’t violate the Interstate Commerce clause of the Constitution? Can it be done so it’s not to the detriment of industry? This is something to look into.”

Benjamin said he could not comment further on the legislation because he had not had time to thoroughly review it.

The bill, which was formally introduced as an Assembly Commerce and Labor Committee bill, would extend the sales and property tax abatements for renewable energy projects for 10 years. The abatements are set to expire in June.

It would also make the Nevada Energy Commission the lead agency overseeing transmission lines.

It wasn’t immediately known how much revenue the fee would raise. Kirkpatrick said the rate would be part of ongoing discussions.

Discussion: 11 comments so far…

By Harley

3/24/09 at 3:41 a.m.

Suggest removal

Another day, another Democrat proposing yet another tax, it never ends.
By Bill_in_Henderson

3/24/09 at 6:47 a.m.

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Good point, Harley. Let's give ALL of our natural resources away for free. Just like we do with gold. That way, we can continue to be last in education. First in crime. And not even in the American League.
By Sunlizard

3/24/09 at 8:24 a.m.

Suggest removal

Most of the power lines and solar facilitie's that Reid wants built in Nevada are going to send the energy to California.

If it goes on your roof, you keep it and these greedy energy developers won't have to muck up the view and destroy thousands of acres of wildlife habitat for these overpriced, water wasting boondggles. Do not invest in industrial renewables built by Nevada Energy and General Electric. There is no good return on it. Most industrial renewable energy facilities cost three times the amount to run than conventional energy. Look it up. It is also not green to plow up thousands of square miles f public lands.
By jfnance32

3/24/09 at 8:26 a.m.

Suggest removal

If you support Solar Power in Nevada then you would oppose this bill. It will make the cost of solar more expensive and drive down the potential of profit. It will discourage investors from investing in solar power in Nevada.

I do not support solar power in Nevada.

It does not create many long term jobs or even short term jobs.

It is expensive energy.

It does not generate 24/7 reliable energy.

My preference is either coal or nuclear.

If not them then I guess we are stuck with natural gas which has big swings in price up and down.

Taxocrats....I mean Democrats....go ahead and apply your knee-jerk solution to all problems...raise taxes on solar power.
By tvegas

3/24/09 at 8:43 a.m.

Suggest removal

You guys elect these yahoos, get used to it. Soon they will let us keep just enough for food and rent. We will all be slaves to the government if we aren't already.
By neiman1

3/24/09 at 10:58 a.m.

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I hope the State of California starts taxing all flights to Nevada. That will help us. Maybe Arizona could quit taking care of the interstate and construct a high toll road to get to Nevada. Once you let these socialist decide the public owns the sun, well, you know.
By farkdawg

3/24/09 at 11:51 a.m.

Suggest removal

The comments on this article are curious, and by curious I mean dumb.

Coal and nuclear? Do any of you know how much water they use? Or how much coal and uranium we mine in NV? PA-LEEEZE!

Solar works with incentives and guess what? Nuclear only works with incentives and coal has subsidies, both direct and hidden, that date back 130 years. So let's not go holding solar to a financial standard that our existing sources of power can't meet.

Any of you interested enough to comment on this article please go to the bill itself and peruse it and come back and tell us all who's fingerprints are all over AB 522.
By Harley

3/24/09 at 2:15 p.m.

Suggest removal

farkdawg wrote: The comments on this article are curious, and by curious I mean dumb.

Coal and nuclear? Do any of you know how much water they use? Or how much coal and uranium we mine in NV? PA-LEEEZE!

Obviously you don't know where Palo Verde Nuclear Generating Station near Phoenix, Arizona gets the water to feed it's three ~1,300 MWe (~3,875 TOTAL MWe) reactors from.
By Harley

3/24/09 at 2:23 p.m.

Suggest removal

farkdawg wrote: The comments on this article are curious, and by curious I mean dumb.

Coal and nuclear? Do any of you know how much water they use? Or how much coal and uranium we mine in NV? PA-LEEEZE!

Speaking dumb?

You probably don't realize that the energy produced from 1 pound of uranium is equivalent to that produced by 33 TONS of coal.
By airweare

3/24/09 at 2:55 p.m.

Suggest removal

Burning coal dumps gobs of pollutants into the atmosphere. At one installation, the parking lot for employees had four quadrants; depending on which way the wind was blowing, the cars were parked on the windward side because those parked downwind would all lose their paint by the end of a shift. There is also the carbon dioxide matter, you know, the greenhouse gas that raises the sealevel and inundates our coastal communities.
Not using solar power here where it falls in abundance at a time when we have practically no backup is absolutely inane. Tax it, benefit locals. Grow it into numerous jobs in manufacturing, installing, operating and maintaining.

Nuclear power is dead in the water in America until someone can find a way to keep the irradiated materials safe for a halflife of plutonium 239, about half a million years. Hey Nance, Harley, you geniuses got a clue about that minor dilemma?
By 2zero

3/24/09 at 6:02 p.m.

Suggest removal

The only thing Nevada exports is gold. Maybe the legislators could muster up the courage to tax gold.

Windfall taxes are the Palin plan, and it worked....create a tax on gold based on the index, when the price of gold is up Nevada gets its share.

What, you actually think these gold diggers are going to leave Nevada...LOL!

And yes we should tax "renewable" electricity that is exported to California, but not in this legislative session...idiot law makers.