Oklahoma City — Wind farms are set to collect nearly $12 million from a tax rebate program that has more than tripled in value in the past three years and that a group advocating against the wind industry's expansion says should be capped.
The Oklahoma Tax Commission will pay $11.9 million to producers of renewable energy — mostly wind farms — in zero-emission tax credits. The commission projects those payments will swell to $19.1 million a year by 2018.
That’s a big liability for taxpayers, said Richard Mosier, president and general counsel for Robson Properties and a member of Wind Waste, formerly the Oklahoma Property Rights Association. The Claremore-based group, which says it's a coalition of residents across the state, concerned about what it describes as “negative impacts” of wind energy in the state.
“It’s something that the Legislature needs to look at and understand what they’ve obligated us for,” said Mosier.
The incentive was created to spur development of renewable energy. Businesses receive credits based on the amount of energy their facilities produce during the first 10 years of operation.
Companies take advantage of those credits by lowering tax payments to the state and cashing in unused credits. For example, if a company has a $100 tax credit and only owes $50 in taxes, it can sell the remainder of the credit, or $50, back to the state for 85 cents on the dollar.
The company pockets the reimbursement from the state’s income tax fund.
Tony Mastin, executive director of the Tax Commission, said the incentive is offered to all renewable energy producers, but the wind industry is the only one that really uses it. The state has relatively few producers of the other kinds of renewable energy that qualify for the program — water, solar or geothermal power.
Mosier said Oklahoma could soon be on the hook for nearly $55 million a year through the program, based on his group’s calculations.