- The Oklahoma Senate unanimously approved SB 498, terminating the 5-year property tax exemption for wind developers, and SB 502, ending wind developers’ investment/new jobs tax credit. Both end as of January 1, 2017, but wind projects currently in production or put into production by December 31, 2016, will retain the full 5-year property tax exemption.
- As a result of negotiations between wind energy advocates, taxpayer advocates, legislators, and Governor Fallin’s office, the state’s $0.005 per kWh zero emissions production tax credit will remain available to developers through 2020, allowing Oklahoma wind to remain cost-competitive.
- The new laws were instituted after wind energy opponents objected to the cost of the incentives with the state facing a $611 million budget deficit for fiscal year 2016. The property tax exemption for wind is expected to cost the state $44.9 million in 2016.
SB 498 now requires only the Governor’s signature. SB 502 requires House approval before it goes to Governor Fallin.
The wind industry has invested over $6 billion in Oklahoma since 2003, including over $340 million in wages for labor. Wind developers pay over $40 million per year to county governments and school districts in sales and property tax revenue. Rural landowners earn $30 million per year in royalty payments for hosting turbines, access roads, and transmission infrastructure. Wind energy produces almost 20% of Oklahoma’s electricity.
“To assist the state budget deficit, the wind industry conceded the full, 100% elimination of the five-year ad valorem exemption beginning January 1, 2017,” said Wind Coalition Executive Director Jeff Clark. “As a negotiated component of the compromise, the legislature will keep the zero emission tax credit active until it sunsets…After 2020, no current incentives will remain eligible for use by wind energy developers in Oklahoma.”