During the 2015 legislative session, I helped derail an attempt to give $75 million in tax credits to wind farm developers. The issue will be back next year.
Tax-credits are not tax abatement, where a developer creates wealth and jobs and they receive an income or sales tax-break, but instead it is a transfer of your hard earned tax dollars to profit others.
More to the point, at this time, there is an absence of need for more wind power in Nebraska.
Nebraska is a public power state. The Nebraska Public Power District, Omaha Public Power District and Lincoln Electric Systems are the big players.
Nebraskans have been well served by those entities historically and have the 14th lowest electrical rates in the nation. The state has fallen in the rankings lately, but the cause is not due to the lack of wind energy but because natural gas prices have plummeted in the last decade verses the cost of coal.
That situation could change at the whim of the energy markets.
NPPD has said their goal is to incorporate 10% renewable energy into the grid, which would allow the system to remain efficient. They are close to that ratio, at present. NPPD has been neutral on the tax credit issue because they are not in the market for more sources of energy.
NPPD, OPPD and LES belong to the Southwest Power Pool, a regional power market of electrical entities encompassing all or parts of 14 states. There is an abundance of electrical energy in the region; the pool has generating capacity of 63,604 megawatts, with a peak demand of only 45,301 megawatts. And, the pool already has a manageable 11% of wind power in its overall power mix.
NPPD has also stated that, although the EPA’s new Clean Power Plan regulations will be costly and bothersome if allowed to go into effect, NPPD does not expect to shut down any of their highly efficient coal burning facilities, but may need to reduce generation and sell less power on the open market.
OPPD is currently working with Warren Buffett’s Berkshire Hathaway Inc. to purchase 400 megawatts of wind power from Berkshire’s now-under-construction wind farm near O’Neill.
When completed, the O’Neill facility will increase Nebraska’s wind power output by 50%, to 1210 megawatts. All of Nebraska’s existing wind power has been built without any state tax incentives. The purchase of the wind power by OPPD will help meet their goal of having 30% of its power coming from renewable energy.
A Sept. 8 Lincoln Journal Star editorial, “The case for a wind tax credit,” stated that LES testified in favor of Wind Tax Credits. Curious stance, considering LES’s home county, Lancaster, is proposing restrictive noise restrictions on wind turbines that would effectively prevent wind development in the county: a typical case of “not in my backyard.”
Apparently, folks at the Lincoln-Lancaster County Planning department and Health Department agree with a quote in the article attributed to me on the negative attributes of living near wind-turbines.
Also mentioned in the article was Northeast Nebraska Public Power’s testimony in favor of the tax credit. Recently, Northeast decided, due to cheaper rates, to no longer buy its power supply from NPPD, but instead from Big River Energy out of Kentucky. Big River generates at least 90% of its power from coal while NPPD is at 52%. Looks like the Northeast board had decided to help support a plan by investors to build a wind farm in northeast Nebraska, but was not willing to support the higher cost of adding more wind energy into the local energy grid.
Presently, wind energy developers are free to build wind farms in Nebraska after going through the Power Review Board process. The push for wind-tax-credits is fueled by money from special interest lobbyists. Developers want the taxpayers, through tax-credits, to pay for 25% of the estimated $2.5 million cost of each wind turbine, thus guarantying the investors an immediate profit.
A better use for the $75 million cost of LB 423 would be for the legislature to start addressing a real problem afflicting Nebraska’s citizens: excessive property taxes.
By Sen. Mike Groene, representing Dist. 42 – Lincoln County – in the Nebraska Legislature.
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