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State officials are renewing calls for renewable energy sources to generate electricity as Texas experienced rolling blackouts and fuel costs rise. Among the most significant is the California Solar Initiative, a 10-year, $2.9 billion program approved in January by the state Legislature to foster the installation of solar electricity plants in residential, commercial and industrial facilities.
“Following the energy crisis, California is well aware of the need for stable energy markets and reliable electricity supplies and transmission systems,” says Susan Carothers, spokeswoman for the California Public Utilities Commission (CPUC). “It is imperative that California have reasonably priced and environmentally sensitive energy resources to support economic growth and attract new investment.”
The state has approved several other programs to encourage use of renewables. According to CPUC, the Self-Generation Incentive Program is the largest and most recent. The rebate program returns to building owners $1 to $4.50 per watt of renewable energy generated on site. The exact rebate is determined by technology, which can include solar, wind, fuel cells and cogeneration technologies. To be eligible for this rebate, the system must generate a minimum of 30 kilowatts per site and is capped at 1 megawatt.
The Emerging Renewables Program covers similar technologies as the self-generation program, with rebates up to $2.50 per watt for the first 7.5 kw generated on site from wind power and $1.50 per watt thereafter. For solar and fuel cells, the program pays $3.20 per watt. Caps vary by technology.
The California solar program aside, most of the big money being spent on electric power generation still goes to plants using traditional fuels. For example, within days of the Texas blackouts, Gov. Rick Perry announced that the state’s largest electricity provider, TXU Corp., planned to invest $10 billion to build 13 new coal-based power generation plants, which are expected to be operational by 2010.
But Texas does offer a few incentives for renewable energy. Like California and 32 other states, Texas offers a 100 percent property tax exemption on the appraised value of an on-site solar, wind or biomass power generating plants.
Texas also offers a corporate deduction from the state’s franchise tax for renewable energy sources. Business owners can deduct the total cost of the system from the company’s taxable capital or take 10 percent of the system’s cost off the company’s income.
Lynn Proctor Windle is a contributing editor to Building Operating Management.