Renewable Energy Tax Credits News Briefs - December 2012

Saturday, December 1, 2012

A group of two dozen investors with more than $800 billion in assets under management wrote a letter urging congressional leaders to extend the production tax credit (PTC) that is set to expire Dec. 31. The group argued that encouraging U.S. investment in clean energy requires stable and long-term incentives, such as the PTC. They warned that expiration of the PTC would damage U.S. competitiveness in the global market and would divert hundreds of billions of investments dollars away from the economy. The letter cited previous expirations of the PTC, which led to wind installations dropping between 73 and 93 percent each time. Among the signatories of the letter are the California State Teachers Retirement System, the New York State Comptroller’s Office, the New York City Comptroller’s Office and the North Carolina, Pennsylvania and Oregon state treasurers. Many signatories are members of the Investor Network on Climate Risk, a project of nonprofit sustainability advocate group Ceres. Find the letter at www.energytaxcredits.com.

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Wind developer Pattern Energy secured funding for its new 112-turbine installation outside the desert town of Ocotillo in Imperial County, Calif. The North American Development Bank approved a 20-year, $110 million construction loan and seven-year commercial bank funding was provided by Deutsche bank, RRC Capital Markets, The Royal Bank of Scotland, Société Générale, NORD/LB and KeyBank. San Diego Gas & Electric signed a 20-year commitment to purchase Ocotillo wind energy and the project may become the first to take advantage of the $1.9 billion, 500,000-volt Sunrise Powerlink transmission line between San Diego and the Imperial Valley desert. San Francisco-based Pattern Energy broke ground on the project in May and hopes to complete construction before the Dec. 31 expiration of the wind PTC.

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A ribbon-cutting ceremony was held in October for NextEra Energy Resources’ Limon I and II Wind Energy Centers in Limon, Colo. Located 90 miles southeast of Denver, the new 400-MW wind generator facility is comprised of two 200-MW projects located throughout Arapahoe, Elbert and Lincoln counties. Power from both projects will be sold to Xcel Energy under long-term contracts. Power will be transmitted through a 45-mile-long, 345-kilovolt transmission line built to connect the wind farms with the missile site substation in Arapahoe County. At the peak of construction, the projects employed more than 300 workers and NextEra estimates that the projects will generate $130 million in state and local tax payments and landowner royalties in the first 25 years of operation.

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Agriculture Secretary Tom Vilsack announced the U.S. Department of Agriculture’s Rural Energy for America program will fund 244 projects nationwide that will help farmers and rural small businesses reduce energy consumption and costs. Projects will also promote the use of renewable energy technologies in rural operations. For example, a dairy farm in Washington State will receive a $2.6 million Rural Energy for America program loan and grant combination to fund installation of an anaerobic digester. The resulting electricity will then be sold to a utility, generating more than 4,600 MW-hours per year. A farmer in Augusta, Wis. will receive a grant to replace an outdated heating system with a high-efficiency, wood biomass boiler system. The replacement will consume 77 percent less wood than the previous one. A full list of recipients is available at www.rurdev.usda.gov.

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The Internal Revenue Service (IRS) invites comments on Notice 2009-52, which describes procedures taxpayers will be required to follow when they irrevocably elect to take the investment tax credit for energy property in lieu of the PTC. There is currently no proposed change to the form. Comments must be received by Dec. 17. More information is available at www.energytaxcredits.com.

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Clean Energy States Alliance (CESA) and Peregrine Energy Group released a recent report on state trends in clean energy development titled, “The Rising Tide of State-Supported Renewable Energy Projects: Results from the CESA Database, 1998-2011.” Drawing from the CESA national clean energy database, the study confirmed that state clean energy funds have played a major role in driving renewable energy development in the country, helping create nearly 130,000 projects and 4.8 gigawatts of new clean power since 1998. Beginning that same year, states invested and leveraged $15.9 billion in the clean energy industry. State-supported projects have generated 10.7 GW-hours of energy and saved 8.1 million tons of CO2 emissions, which equates to taking 1.4 million cars off the road. Download the report at www.energytaxcredits.com.

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Faculty and students of Hagerstown Community College (HCC) in Hagerstown, Md. will participate in an alternative energy technology program organized by HCC and First Solar Inc. The Maryland Solar facility, a First Solar project currently under construction in Washington County, will provide HCC with site visits, guest lectures, internships and a digital dashboard so visitors can view operational data from the solar farm. Maryland Solar will also provide the college with solar panels that will offset electricity usage on the campus and will allow the school to maintain a small solar power plant in addition to a rooftop photovoltaic system. The 20-MW Maryland Solar facility is expected to be ready for commercial operation in 2013.

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The IRS published a comment invitation for Notice 2009-72 on Qualifying Advanced Energy Project Credit. There are currently no changes proposed and the comment invitation was issued in compliance with the Paperwork Reduction Act of 1995. Comments must be received by Dec. 24. More information is available at www.energytaxcredits.com.

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