Legislation Supports Multiple Forms of Renewable Energy
Nebraska legislators have proposed multiple bills to support wind, solar, and other forms of renewable energy by enacting tax credits and requiring the State to provide additional resources.
On February 4, 2016, the Nebraska Legislature held a hearing for LB 736 (Friesen), a bill that clarifies that any public power district, a public power and irrigation district, an individual municipality, a registered group of municipalities, an electric membership association, or a cooperative may execute a contract for the purchase of energy from a community-based energy development (C-BED) project. A C-BED project is a new energy generation project using renewable energy that has at least 25 percent of the gross power purchase agreement flowing from a Nebraska individual or entity to the local community. LB 736 also amends Nebraska Revised Statutes section 70-1905 to no longer require an electric supplier to produce an annual statement regarding its C-BED efforts. Baird Holm is working on this bill to clarify the statute.
LB 423 (Schilz), a carryover bill from 2015, provides an income tax credit for producers of renewable energy. The producer must elect one of two methods in which to receive the credit: (1) a credit of .75 cents for each kilowatt-hour of electricity generated for the first two years of the credit period and gradually reduced over the next eight years, or (2) a one-time credit equal to 30 percent of the total cost of construction of the facility up to $2,000,000 per project. The credit is transferable to any entity or person for projects with a nameplate capacity of 20 megawatts or less, and the holder may carry forward any excess portion of the credit for up to seven years. The bill is currently pending on Select File, the second-to-last stage of debate. Baird Holm brought this bill on behalf of several clients, and we continue actively seeking its passage.
Aside from those two bills, LB 863 (Schilz), LB 1085 (Kintner), and LB 1071 (Haar) seek to further support Nebraska’s need for renewable energy. The Nebraska Legislature held a hearing on LB 863 on February 4, 2016. LB 863 would create the Wind Energy Expansion Act, which requires the State Energy Office to create a process for recognizing counties friendly to wind energy and to provide a database containing wind-energy information to assist in preparing permits. LB 1085 creates an income tax credit for producers of renewable electricity in counties with less than 7,000 people. The credit is calculated based on either kilowatt-hours of electricity generated or a percentage of the total cost of construction of the facility. The credit allows for some transferability and may be carried forward for up to five years. Finally, LB 1071 proposes a $4 million grant program supporting solar energy development to electric utilities, local governments, businesses, or individuals. The program would be administered by the State Energy Office.