An effort to attract more wind farms to Nebraska failed on Tuesday after senators derailed a bill that would have provided $75 million in production tax credits for renewable energy.
Conservative senators mounted a filibuster to block the proposal, arguing that the state shouldn’t subsidize wind energy.
The bill by Sen. Jeremy Nordquist of Omaha would have provided up to $75 million in tax credits over a decade for wind farms. Nordquist agreed to the cap and a December 2021 sunset date for the program to try to win support for the legislation.
Currently, companies that participate in the state’s community-based energy development program have to spend at least 25 percent of their total investment on goods and services in Nebraska.
Nordquist said the wind farms would also generate property tax revenue for counties and lease payments for landowners who allow them. Wind farms would only receive the credit when they produce electricity.
Sen. Ken Schilz of Ogallala said energy tax credits have benefited Nebraska in the past. He pointed to the state’s ethanol industry, buoyed by federal and state subsidies.
“We need to be careful that when things are changing, we don’t just stick our heads in the sand,” Schilz said. “Change brings opportunity.”
Senators voted 30-12 to bring the bill to a vote, but supporters needed 33 to overcome the filibuster.
Sen. Mike Groene of North Platte led the filibuster, arguing that the turbines are an eyesore and government shouldn’t subsidize them.
“This is unnecessary, this is feel-good legislation, and it needs to stop,” Groene said.
Sen. Paul Schumacher of Columbus said Nebraska should look to invest in other potential energy sources, including new, experimental forms of nuclear energy. Schumacher said Nebraska is already “way behind the power curve” with its wind policy, and could take a lead in renewable energy by looking at more speculative options.
“We could be a player there, and $75 million could put us in the game,” Schumacher said. Investing in small-scale wind farms “will not make Nebraska a leader or even a competitor or even a player in the renewable energy wind game.”
The bill could also apply to producers of solar, biomass and other renewable energies. It would allow companies a 1-cent tax credit for every kilowatt-hour generated for the first two years. The credit would shrink to 0.6 cents per kilowatt-hour over 10 years, after which it would end.
Wind-energy companies could also turn down that option in favor of a one-time tax credit totaling 30 percent of their construction costs, up to $2 million.
Wind farm developers could sell the tax credit to other companies at a discount, allowing the wind farm to generate cash while the buyer lowers its tax liability.
Nebraska ranks as one of the nation’s biggest wind-producing states, but 26th in the energy it could produce with equipment currently installed. It lags behind neighboring states Iowa, South Dakota, Wyoming, Colorado and Kansas.
Nebraska is the nation’s only state that relies solely on public power.
The bill is LB423.
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