Wind Tax Credit Rollback to Take Effect July 1

Oklahoma is within days of officially rolling back a 10-year tax credit for electricity generated by wind. Governor Mary Fallin signed House Bill 2298 into law after a movement was started in 2016 by anti-wind groups, largely the oil and gas industry, in which complaints were made of the millions of dollars in unneeded credits for the wind industry.

The cry of the oil and gas industry led to the creation of the Windfall Coalition after tax credits grew from $3.7 million in 2010 to more than $113 million in 2014. The movement led to the house bill that created debate in the House and Senate where approval was finally made this year.

The House passed it on a 69-25 vote while in the Senate, approval came in a 40-3 vote. On April 17, Gov. Mary Fallin signed the rollback bill into law.

“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,” said governor in signing the bill.

She referred to the fact that Oklahoma now ranks No.3 n the nation for installed wind power capacity.

House Bill 2298 requires wind farms to be operational by July 1 if they are to qualify for the state’s Zero Emission Tax Credit. It led to complaints from wind industry supporters that it would create a lack of trust in any state agreements. The bill ends the tax credits three years early for some operators. Industry leaders also complained the state was essentially reneging on a promise of tax credits for those wind farms that were still under construction and would not meet the July 1 deadline.

“In this case, the policymakers have overshot and came up with a deadline that clearly sends a message that can’t be walked back to financiers of all kinds looking at Oklahoma for further business investment,” said Virinder Singh in an interview with StateImpact. He is director of regulatory and legislative affairs for EDF Renewable Energy which has wind farms in Oklahoma.

“This bill is about prioritizing expenses during a contraction cycle in state revenues,” said House Speaker Charles McCall in defending the measure as the legislature struggled with a $868 million budget shortfall. “The behavior you incentivize is the behavior you received and we have incentivized the wind industry during the last two decades.”

 

 

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