To resolve cost issues, the utility commission established an amount that utilities can assess against wind developers to make up for the costs associated with integrating wind into the power grid. The commission also removed a cap on the size of small-power projects that can qualify for a rate published by the commission. However, the judgment was not easily reached. In 2005, Idaho Power asked the commission to suspend small-power wind development so it could study how much it costs the company to provide back-up generation when wind output fluctuates.

Idaho's regulated utilities, wind developers and state regulators have finally reached consensus on how much it costs to add wind to utilities' transmission grids. Three orders issued Tuesday by the Idaho Public Utilities Commission establish the amount of discounts utilities can assess against wind developers to account for the cost of integrating wind into their systems. The orders also remove a cap on the size of small-power projects that can qualify for a rate published by the commission.

The plethora of goods and services exempt from Idaho sales and income taxes has lawmakers wondering if the time has come to curb the exemptions. More than 100 exemptions for sales and income taxes keep millions of potential tax revenue out of state coffers, state officials say............One of the newest sales tax exemptions is a break for companies that buy equipment to build wind farms or other alternative energy projects. Tax officials say this makes Idaho more competitive with states like Montana and Oregon that don't have sales taxes.

A final obstacle to a booming Idaho wind-energy industry may be close to cleared, the state's three major utility companies indicate. Idaho Power Co., Avista Corp. and PacifiCorp say they're proposing a deal with wind developers that may lift a temporary restriction on the amount of energy Idaho wind farms can produce. The deal could spawn a legitimate wind-energy industry in southern Idaho if the temporary restriction is lifted, said Gene Fadness, a spokesman for Idaho's Public Utilities Commission, the state's energy regulating agency. The restriction has blocked several wind producers from starting business......Under a federal law, utilities must accept alternative energy at a rate of about $64 per megawatt-hour. The utilities propose lifting the size restriction but cutting the rate by between $5 and $7.50 per megawatt-hour to pay for backup generation when the wind doesn't blow.

Idaho's three large regulated electric utilities have proposed a settlement with wind developers that they say could resolve cost issues that have slowed development of small wind projects in Idaho. Idaho Power had asked the Public Utilities Commission to place a moratorium on rapidly increasing wind development projects within its territory while the company studied how much it would cost the utility to accept wind-generated power and to provide for backup generation when wind output is less than projected. The commission denied the request, and it reduced the size of wind projects that could qualify for the commission-posted rates that utilities must pay generators of small renewable power projects. It lowered the size of wind projects that qualify for the posted rates from 10 megawatts to 100 kilowatts. Having completed their studies, Idaho Power, Avista Corp. and PacifiCorp are recommending that the published rate for wind-generated power be discounted to allow for wind intermittency and that the size limit of projects that can qualify for the rate be brought back to 10 megawatts.

Two bills making it easier for landowners to set up wind power generation systems on farms, ranches or state lands were signed recently by Idaho Gov. Butch Otter. One became effective immediately. It is House Bill 189, which moves the taxes assessed on wind farm operations from the ad valorem property tax roles to the production tax list. Operators will be taxed on their output, rather than on the physical generation equipment. This means more monies will go to the counties, and the amount should even increase a little from year to year, said Dar Olberding, lobbyist for the Idaho Grain Producers Association. That's why the counties supported this bill, he said.

BOISE - The state Senate Local Government and Taxation Committee passed a bill Tuesday that would relieve commercial wind farms of paying property taxes and instead require a form of excise tax - a "production tax" - through 3 percent of their annual gross revenue. The legislation, sponsored by Rep. George Eskridge, R-Dover, on behalf of Ridgeline Energy, a wind power company seeking to expand in Idaho, recently passed the House. Supporters said the owners of the turbines rarely have enough money to pay property taxes immediately. The law would give them additional time by taxing their energy output, as well as offer investors a chance to make steadier payments and provide counties up to 10 percent more money for 20 years.

In three years, an entirely new industry to the state has found a home in Magic Valley: wind. It doesn’t employ many people. It doesn’t have a flashy corporate image. It doesn’t get talked about much. But that’s all changing. A handful of low-key southern Idaho wind producers may be the state’s next energy pioneers - especially as Idaho works toward developing low-emission energy sources. Idaho Power Co. finalized deals with two new wind producers last week, bringing the total amount of wind energy in its system to 400 megawatts. Three years ago, that number was zero.

Wind turbines, those domineering and swooping machines of clean energy growing in both numbers and popularity, are being noticed by lawmakers. Rep. George Eskridge, R-Dover, introduced legislation Tuesday that would relieve commercial wind farms of paying property taxes and instead require a form of excise tax - a “production tax,” he said - through 3 percent of their annual gross revenue. Eskridge and energy lobbyists said the owners of the turbines rarely have enough capital to pay property taxes immediately. The law would give them additional time by taxing their energy output, as well as give investors a chance to make steadier payments and provide counties up to 10 percent more money for 20 years. A similar measure passed in the House last year but stalled in the Senate.

At just the time of year when work output slows to a crawl in many organizations, the Idaho Public Utilities Commission is being asked to render a tough decision quickly in a case that has far-reaching implications for wind project development in the state. In September, Jared Grover, developer of the proposed Cassia Gulch Wind Park and Cassia Wind Farm near Hagerman, Idaho, filed a complaint with the commission challenging Idaho Power's intent to charge wind developers the estimated $60 million costs of transmission system upgrades needed to accommodate nearly 200 MW of capacity expected from such projects. Grover's portion of this upgrade would be about $7 million, an amount he says would force him to scrap his projects and would sound the death knell for many other wind projects pending in Idaho.

The Idaho Public Utilities Commission heard oral arguments Tuesday in a case that will play a big role in future development of wind power in the Gem State. A complaint filed by Cassia Gulch Wind Park and Cassia Wind Farm alleges an Idaho Power requirement that small-power producers pay for nearly $60 million in transmission upgrades will stifle the economic development of a number of wind projects and delay development of renewable energy in Idaho. “If we’re saddled with a $50 to $60 million burden, there’s no way I could entertain any investors to take on that risk,” said Jared Grover, the developer of the Cassia wind projects near Hagerman, in an interview with CBS 2 News.