North Dakota Governor John Hoeven signs renewable energy legislative package

BISMARCK, ND (04/26/05) --  Gov. John Hoeven signed a comprehensive legislative package last Friday designed to accelerate production of wind energy and biofuels, as well as to enhance the transmission infrastructure necessary to get both renewable and conventional energy to market. The plan also builds on the Governor’s Counter-cyclical Ethanol Production Incentive, passed last legislative session, by making $4.6 million available for new and existing plants in the next biennium.

In addition, new legislation will create an Office of Renewable Energy within the Division of Community Services at the North Dakota Commerce Department. The new office will assist in the development of renewable energy within the state and promote the conservation of energy and the wise use of energy resources in both the public and private sectors. The office will administer the programs and advance information pertaining to the state and federal incentives available for the full range of renewable energy sources.

“Everyone involved with designing energy legislation this session can be proud today of the work we’ve done to expand renewable energy production in North Dakota,” Hoeven said. “We have now established a comprehensive program to give the renewable energy sector a significant boost in North Dakota.”

A range of new energy incentives will benefit each renewable energy sector:

Wind

• A North Dakota Transmission Authority, which will promote new - and substantial - investment in transmission lines in North Dakota. (HB1169)
• A provision to allow the trading of premium renewable energy credits to plants in other states, which promotes the development of wind energy in North Dakota. (HB 1314)
• A provision to raise the jurisdictional threshold for siting electrical power generation facilities from 50 to 100 thousand kilowatts, reducing the regulatory burden for wind energy companies to site plants in North Dakota. Below the threshold, the company doesn’t require siting approval from the PSC. (HB1283)
• A provision to reduce the maximum siting application fee for a power conversion facility or a transmission corridor from $150,000 to $100,000, and to return to the applicant any portion of the fee unspent by the state in the siting process. (SB2133)
• A reduction in the assessed value of a wind turbine electric generation unit from 3 percent to 1.5 percent to promote the commencement of construction on wind facilities prior to July 1, 2006. (SB2018) (PENDING)

Ethanol

• A continuing appropriation for the Governor’s Counter-cyclical Ethanol Production Incentive, which makes available up to $4.6 million in the next biennium, including $1.35 million for expansion of existing ethanol plants.
• A 20-cent-a-gallon tax incentive for E85 at the pump, which must be passed on to the consumer (up to 1.2 million gallons). (HB1478)
• A 30 percent investment tax credit for all investors in ethanol or biodiesel production facilities (will include Red Trail investors). (SB2281)

Biodiesel

• A $1.2 million Biodiesel PACE program, which will provide up to $650,000 in interest buy-down for a biodiesel plant, by providing $400,000 combined with $250,000 in regular PACE. (SB 2217)
• An income tax credit of 10 percent per year for up to 5 years, or 50 percent of direct costs for biodiesel sales equipment, such as pumps, hoses and tanks purchased by retailers. (SB 2217)
• An income tax credit for any fuel supplier that blends biodiesel fuel to the ratio of 5 percent, or B5. The credit equals five cents per gallon of fuel blended. (SB 2217)
• A sales tax exemption on the sale of new equipment to any facility that will enable the facility to sell diesel fuel containing at least two percent biodiesel fuel. (SB 2217)

Hydrogen

• A sales tax exemption on hydrogen to power an internal combustion engine or fuel cell. (HB1496)

“The legislation we have just signed will create new synergies and new dynamics in North Dakota’s energy markets,” Hoeven said. “Wind and coal, ethanol and coal, biodiesel and oil and gas - we are now putting in place a comprehensive strategy that creates a strong and effective role for all of North Dakota’s diverse energy products.”