Library filed under Taxes & Subsidies from Texas
Lack of action on a tax abatement for a company looking to build a series of wind generators in western Cooke and eastern Montague counties could send the alternative energy project to other counties, a spokesman said Monday. The Cooke County Commissioners Court took no action in its Monday meeting to give or deny Florida Power and Light a tax abatement for a series of gargantuan wind-powered electric generators on about 10,000 acres in western Cooke County. ...“The lack of action will probably kill this deal, and we’ll now have to reconsider our investment in Cooke County,” Edwin Giraldo, project manager for Florida Power and Light, said in an interview following the meeting. ...“The bottom line is that there is opposition to the windfarm, regardless of the benefits it would provide,” he said.
Currently, six wind energy companies are negotiating contracts with Howard County school districts that will allow them to pay reduced property taxes for about eight years, while still providing an economic benefit to the school systems. School districts, unlike other taxing entities, are not allowed to grant tax abatements to companies. However, a recent state law allows the districts to cap tax valuations on new companies for a period of time. And this change could mean millions of dollars for school districts.
Tax subsidies have largely been an unchallenged tool for governments seeking to attract businesses, but some public officials say the policies for granting them need to be more sharply drawn and to provide more information to the public. Tax subsidies granted by local school boards, for example, cost the state about $150 million a year, yet the state is just now asking the boards to account for the money they're giving away. The office of Texas Comptroller Susan Combs sent letters Nov. 6 to 38 school districts, asking for financial information on subsidies they have given to companies ranging from wind farm operators to corporate data centers.
No action was taken by Gray County commissioners Thursday morning to establish a reinvestment zone concerning a proposed wind farm by T. Boone Pickens, a Roberts County rancher and Dallas businessman. ...A reinvestment zone, once called an enterprise zone, is an area in which businesses could apply for potential tax abatements if they establish a facility within the zone ...The wind farm is expected to consist of approximately 1,400 generators spread over 300,000 acres in areas of Gray, Hemphill, Roberts and Wheeler counties, with most of the units in Gray and Roberts counties.
Howard County commissioners approved a trio of reinvestment zones necessary to grant tax abatements Monday morning, moving forward with negotiations with several wind energy developers that could lead to an estimated 400 to 500 new turbines being erected in the county. Commissioners met with Terry Wegman, executive director for Moore Development, who is serving as a liaison between the wind energy developers and local taxing entities for the purpose of establishing reinvestment zones, and ultimately, negotiating tax abatements for several proposed projects. The court approved reinvestment zones A, B and C, following a public hearing that drew comments from only a single property owner. ..."Even the smaller developments - the smallest one is 36 megawatts - will be putting up quite a few turbines. I think we're looking at between 400 and 500 turbines at this point, but that's nothing more than a rough estimate."
A variety of groups is discussing tax abatements in the northern Panhandle. Counties and other taxing entities are considering abatements for a handful of projects, several of which involve renewable energy. On Tuesday, the Palo Duro River Authority passed an abatement for Sunray Ethanol, which is planning a plant north of town, said Jim Derington, general manager of the authority. Other action included amending abatements for the North Texas Wind Center in Hansford County, a planned electric generation project previously granted an abatement as Great Plains Wind. The Palo Duro board also adjusted an agreement for a wind project by John Deere in Moore County and extended an agreement made earlier with a delayed fertilizer manufacturing plant in the S.B. Foot Tannery at Cactus.
Donley County Commissioners approved a ten-year tax abatement agreement for a $90 million wind farm project on the Trew Ranch during their regular meeting Monday. Dale Cummings, a tax attorney who represents wind farm developer Iberdrola, said the agreement means good things for both parties. "I think it's a good deal for us and for the county," Cummings said. "Hopefully it opens the door to a lot of wind power developments in Donley County."
Randall County is inching toward granting tax abatements to a wind energy company. County commissioners approved a reinvestment zone Tuesday that will cover a portion of the southwest corner of Randall County. The reinvestment zone will now allow the county to begin negotiations on exactly what type of tax abatements Chermac Energy Corp. can receive for its 480-megawatt project.
The Energy Department announced Monday it will provide $4 million to two projects in Texas and Massachusetts for research into designing and building the next generation of large wind turbine blades.
This year Fort Collins Wind Power Program will hand over more than $1 million to Platte River Power Authority to help the city reach its goal of having 15 percent of its energy come from renewable sources by 2017. Of that money, some $366,000 will be used to purchase what are called renewable energy credits (RECs) from out-of-state projects that cannot-or will not-detail how the money is being used to help reach that goal. Without such accountability, it is unclear how Fort Collins' wind power dollars are helping to create new renewable energy, which is the ultimate goal of these credits.
Local and federal officials are hoping to head off future encroachment issues as the expanding wind energy industry creeps toward the Dyess Air Force Base flight path. U.S. Rep. Randy Neugebauer, R-Lubbock, is hosting a meeting at Dyess Tuesday for representatives from the city of Abilene, Taylor and Nolan counties, the Department of Defense, the Department of Energy and the Federal Aviation Administration. At stake is the future coexistence of two major economic players in the Abilene area - Dyess and the burgeoning wind energy industry.
The wind game is pay to play. Rural counties are enticing companies to invest millions of dollars to build wind farms with tax abatements.
What is Goldman Sachs doing in rural Texas? Probably some of its bankers have wondered that themselves, when they find they're three hours from the nearest latte. One of Goldman's subsidiaries, Houston-based Horizon Wind Energy, is constructing a $600 million, 400-megawatt wind farm in the boonies west of Dallas. Financiers of other wind-power projects and explorations, spread across central and west Texas, include Wells Fargo; JPMorgan Chase; Macquarie, Australia's largest investment bank; and John Deere's credit division, which already has close ties to rural America. To some extent, the lure of wind for such financial powerhouses is obvious. Bankers are always looking for high-growth sectors for investment or loans. Wind fits the bill, as the fastest-growing energy segment in the world. In Texas - which last year passed California to become the largest wind-power producer in the U.S. - the boom is sometimes likened to the gold rush. Energy giants such as BP and Shell are investing heavily too.
In this pancake-flat country, where the wind blows so relentlessly that the sagebrush and mesquite are permanently bent, Royal Dutch Shell Group, BP PLC and a wind-development company owned by Goldman Sachs Group Inc. are racing to lease vast expanses of ranchland. In a bet on wind power's long-term viability, they're planning to erect what would be some of the biggest wind farms in the world, with thousands of wind turbines costing some $2 million apiece.
Texas has surpassed California as the country’s top wind-energy producer, but the new technology is clashing with old ranching ways Texas ranchers have embraced helicopters for herding, wireless Internet access for keeping an eye on the futures markets and microchips for tracking their cattle, but there is one piece of modern technology that is sparking a range war in the vast open spaces of the state — the windmill turbine, which opponents say is noisy, ugly, dangerous to wildlife and a tax boondoggle to boot.
TXU Corp. Chairman John Wilder said “everybody’s mad as a hornet” about Texas’ high electricity rates, but said increased supply of electricity that would come from 11 new coal-fired generating plants TXU wants to build would be the solution to Texas’ increasingly tight electricity supply. Wilder acknowledged that TXU probably won’t be able to achieve significant carbon dioxide emission reductions for years, perhaps as late as 2020, he said, but added “there is no perfect fuel for electricity generation........ Wind power, Wilder said, is inefficient because wind can’t be depended on to blow consistently at the right times “and besides, it costs 12-14 cents per kilowatt hour to make electricity from wind unless it is subsidized by the government.”
Local architect Stephen Colley jumped at the chance to pay more for his electricity on the first day he was able to do so. That's right, he volunteered to pay higher electric rates. So have hundreds of thousands of others around the country, and more are doing so every day, paying a premium to buy "green" energy and reduce the release of greenhouse gases.
Houston-based Reliant has sparked a debate over subsidies that has the EPA, citizens and consumer advocates concerned
In reality, this project should generate for its investors about $2.46 billion over 20 years through the sale of power and Texas renewable energy credits, which are paid by Texas ratepayers. An additional $333 million in federal production tax credits will be added to the revenue stream, along with an anticipated county and school tax abatement (tax forgiveness) generally demanded by all wind project developers of between $125 million and $265 million, depending on the project cost. With the project taking advantage of almost half a billion in tax abatements and credits (some directly out of school district funds and state school funds), lease royalties of only $34 million to $112 million to benefit the state education fund hardly add up to "a good deal." Simply put, Texas public school children, and all Texas residents, will be harmed from a revenue standpoint if the Superior project is built.
he honeymoon is over -- for now -- for Xcel Energy customers who enjoyed a price advantage by using the Windsource voluntary green-power program.