July 8, 2013
Maryland

Wind, solar could remain free of taxes in Montgomery

by Kate S. Alexander Staff writer | July 08, 2013 | www.gazette.net

This story was corrected at 6:15 p.m. July 9. An explanation follows the story.

Montgomery County doesn’t charge its controversial energy tax on local renewable energy sources, but it could, so county leaders are trying to change the law.

The County Council introduced a bill Tuesday from the executive’s office that would officially exempt energy produced and delivered in the county from renewable sources, such as solar and wind, from being taxed.

The bill essentially codifies what the county does now.

Currently, all sources of energy can be taxed, but not all sources are being charged.

Montgomery charges the tax through a power bill, so only electricity that runs through the meter is charged, said Stan Edwards, chief of the county’s Division of Environmental Policy and Compliance in the Department of Environmental Protection.

Since power generated by solar panels on someone’s home is not counted by the meter, it is not being charged, he said. But wind energy bought from a company with a wind farm in Texas that delivers the power over Pepco’s lines would be taxed, he said.

The bill would officially exempt locally produced renewable energy from the tax, he said.

Changing the law will have little impact on Montgomery’s bottom line initially.

In fiscal 2014, the county expects to generate about $210 million from the tax.

Exempting renewable sources would cut about $108,000 of that revenue for the near future, according to county estimates.

However, the county anticipates that as more residents and businesses turn to alternative energy sources, substantially more revenue would be lost through the exemption.

Leggett said the bill is designed to encourage residents and businesses to use more renewable energy.

As the tax currently stands, it hinders efforts to increase the use of alternative and renewable energy sources, he said.

Joyce Breiner, executive director of Poolesville Green, said at first read, the bill sounds like it will fulfill Leggett’s intent.

Breiner said she has solar panels on her home that produce enough energy for the home to have a net of zero consumption of power for the year from her provider Potomac Edison, and in the warmer months, to actually put some power back onto the grid.

“I think anything that gets us to a point where we make a better world for our children and our children’s children is a step in the right direction,” she said.

Saving money on her power bill was not what drove Jill Siegel of Rockville to install solar on her home in May.

Siegel said she enjoys watching her meter spin backwards when she generates solar power. Her energy consumption dropped about 70 percent, from an average of 2,600 kilowatts for June to only 780 kilowatts.

But what helped her decide were other incentives, like the federal income tax credit, which is equal to 30 percent of the total cost of the system, and the $1,000 she will get back from the state, she said.

“Those incentives are what make it affordable to put a system in,” she said.

Siegel researched solar panels for about three years before buying her 10-kilowatt system. She said that everything from the size of a house and the direction it faces to the quality of the system and the company selling it will determine how much it costs.

She knew of one that cost about $19,000 and others that cost $44,000.

Leggett asked that his bill be fast-tracked. It is scheduled for a public hearing at 1:30 p.m July 30.

If the bill passes, the measure would take effect immediately, but it needs a supermajority of six members to pass. Most legislation is not effective until 90 days after it becomes law.

An earlier version of this story incorrectly reported that the county currently taxes all fuel energy sources. Actually, the county does not impose a tax on some renewable energy sources now.

URL to article:  https://www.wind-watch.org/news/2013/07/08/wind-solar-could-remain-free-of-taxes-in-montgomery/