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article imageOklahoma governor signs bill to eliminate wind energy tax credits

By Karen Graham     Apr 18, 2017 in Politics
Tulsa - On Monday, Oklahoma Governor Mary Fallin signed a measure to speed up the elimination of a state tax credit that goes to the wind industry. The legislation goes into effect on July 1, 2017.
The tax credit was instrumental in propelling Oklahoma to third in the nation in its capacity to generate electricity from the power of the wind. By signing the legislation, the governor rolled back a 10-year tax credit for electricity generated from zero-emission facilities that was launched in 2003, according to US News.
House Bill 2298, sponsored by Speaker of the House, Charles McCall (R-Atoka), and Senate Pro Tem Mike Schulz (R-Altus), sets the expiration date for the tax credit to July 1, instead of allowing it to continue until 2021, reports Tulsa World.
The legislation will allow wind projects started before the expiration date to claim the tax credit for up to 10 years, but new wind projects started after July 1 cannot claim a tax credit. Since the zero-emissions tax credit was started, it grew to a little over $113 million in 2014 from nearly $3.7 million in 2010.
"The zero emissions tax credit was key to the growth of wind energy in Oklahoma, and I’m grateful to the industry for their ambitious successes, as well as their willingness to work with the state to address our challenging budgetary circumstances,” Fallin said.
“Their leadership, along with the leadership of Speaker McCall and Senate Pro Tem Schulz, is a critical part of our continued investment in the future of our state. It is time to ensure that Oklahoma has a bright future, and continues its position as a prominent energy state.”
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U.S. Energy Information Administration.
Oklahoma's budget shortfall behind elimination of tax credits
Being a renewable energy source had nothing to do with the elimination of the wind energy tax credit. Oklahoma lawmakers are struggling to close an estimated $868 million budget shortfall. However, closing the window of eligibility will not have any short-term effects on state tax collections.
The first year any change will be really noticed will be in 2027. But even so, any revenue generated by wind facilities won't "move the needle very much on the state budget," said Dr. Stephen Stadler, a board member of the Oklahoma Renewable Energy Council.
He wants the legislature to eliminate other tax credits, including the very generous subsidies given to oil and gas industries. "Can we afford those subsidies?" Stadler asked. "Things are not even. It's not a level playing field."
Richard Mosier, an attorney in Claremore and a member of WindWaste, a nonprofit organization critical of the wind energy industry says that plans for additional wind power facilities indicate the tax credit incentives will remain high. "The growth of the wind industry in Oklahoma has been exponential," Mosier said. "It was pretty clear to us that we couldn't afford it. It was going to be a drain on the state treasury."
Senate Pro Tem Schulz said, “Accelerating the end date of the wind-energy tax credit provides certainty for the industry and more predictability and stability long term in the state budget." He added that freeing up funds would provide more money for high priority items, like education, healthcare, and public safety.
More about Oklahoma, Tax credits, Wind energy, third in nation, budget shortfall
 
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