Imagine the outrage if the petroleum industry got tax incentives for drilling wells in Oklahoma, but never paid any taxes on the energy it took out of the state.
Imagine if that reverse taxation threatened to take Oklahoma’s already troubled fiscal situation even deeper underwater.
Imagine if all the oil and most of the jobs went to other states, and Oklahoma only got the derricks and the environmental problems the industry created.
All of that is true … but not about the petroleum industry.
Big Wind, a highly profitable industry dominated by out-of-state (and sometimes off-shore) companies, is taking the state’s wind energy and its money and leaving us little more than whirling windmills.
Last year, the Legislature phased out property tax exemptions to wind farms, but the state is still hemorrhaging money on special, zero-emissions tax credits.
The zero-emission tax credits are refundable, which allows Big Wind to amass more in credits than they owe in taxes and make a profit on the backs of the Oklahoma taxpayers. The sweetheart deal is also uncapped, meaning there is no limit to how much it could cost the state.
Every penny Big Wind sucks out of the state is money that won’t go to teachers, roads or public safety.
Windwaste, an advocacy group pushing for a more equitable taxation, says under the current tax law, recent wind farm generation growth announcements and projects in the works could cost the state more than $2.4 billion over 10 years.
Much of that money is going to foreign companies to create energy that is already sold to utilities outside of Oklahoma. The whole thing creates relatively few permanent jobs here.
Here’s the solution: First, moderate the tax incentives on wind energy. Cap the costs, and end the refundable corporate welfare. That leaves reasonable incentives in place for companies to create wind farms.
Then, put a severance tax on wind-created energy, just like the severance taxes on oil, natural gas, coal and timber. Wealth is being extracted from the state’s natural resources, and those raking in the profits need to pay their share of the cost of state government.
We love wind energy. Who doesn’t. It’s relatively clean, renewable and abundant in our state. We want more of it created in Oklahoma and elsewhere.
And we continue to advocate for more robust taxation of the petroleum industry, just as we did last year when that industry’s severance tax was being debated in the Legislature.
The petroleum severance tax is too low, and it ought to be raised. But at least the petroleum industry is paying a severance tax. Big Wind pays none.
It’s a bum deal for the state hidden in the camouflage of clean energy, and with Oklahoma facing an enormous budget hole we can’t afford it any longer.
via Tulsa World