The growing battle between Wyoming lawmakers and the largest wind developer in America

Source: By Benjamin Sorrow, Wyoming Star Tribune • Posted: Monday, May 23, 2016

State lawmakers and the developer of the largest onshore wind farm in America are increasingly at odds these days. The subject of their strife: a proposal to raise Wyoming’s wind-generation tax.

Power Company of Wyoming officials say the measure puts in limbo their plans to build 1,000 turbines in Carbon County. The 3,000 megawatt project — enough to power nearly 1 million homes — will be left at a disadvantage relative to renewable producers in other states, they argue. Wyoming is already the only state in the country with a wind-generation tax.

The Denver-based company had planned to begin construction on a haul road this year. Now, it is uncertain if that work will begin.

“It’s just difficult to plan,” said Kara Choquette, a Power Company of Wyoming spokeswoman. “We’re still working on our plans to begin construction. Whether we can begin construction, that is the question.”

Wyoming lawmakers are calling such statements a bluff. The Cowboy State’s bountiful breeze means developers will continue to flock to its vast expanses of wind-blown prairie, regardless of the tax, they say. What’s more, they argue, Congress extended the $23-per-megawatt-hour tax credit for wind producers last year. They contend Power Company of Wyoming can spare some of those proceeds.

“This isn’t my first rodeo on this type of thing. People come in and say, ‘If we don’t get this tax exemption, we’re going to have to close down,’” said State Rep. Mike Madden, a Buffalo Republican who chairs the Revenue Committee. “How do you prove that?”

The debate is especially fraught because it comes at a time when Wyoming is reeling from an extended downturn in the coal, oil and natural gas sectors.

The number of people seeking unemployment in the state has risen by 40 percent in the past year. State coffers are $130 million short of revenue projections for the current fiscal year and Gov. Matt Mead has said state government may need to cut $300 million over the next two years.

News of a potential tax hike on wind generation was greeted with fierce opposition by local officials in Carbon County.

The Chokecherry Sierra Madre Energy Project, now nine years in the making, is expected to create 945 construction jobs at its peak and almost 115 full-time positions once the turbines go into operation. A neighboring substation is expected to require another 1,000 jobs during construction.

“I think the Legislature is getting greedy and trying to kill the goose laying the golden egg,” said John Espy, a county commissioner. “If they do this, and it shuts down Chokecherry Sierra Madre, I think a couple legislators should think about retiring.”

His colleague, Commissioner Leo Chapman, said it was foolish for the state to try and saddle wind producers with the responsibility of making up lost revenue from the fossil fuel industry.

“It doesn’t replace oil, gas and coal, but it sure as hell helps,” Chapman said.

Wyoming legislators backing the proposal said they were not seeking to stifle wind development. Instead, they said they are striving to ensure wind producers shoulder the same tax burden as their counterparts in the fossil fuel industry.

A study by the state Legislative Service Office found wind producers pay $1 per megawatt hour in taxes. That figure includes the state’s 40-cent-per-megawatt-hour wind-generation tax. Coal paid between $1.77 and $2.69 per megawatt hour, depending on its quality. Natural gas paid $3.49 per megawatt hour, the study found.