February 14th, 2010
© cliff1066™
For decades coal has carried local governments in many states through a severance tax – an excise tax paid based on the tonage of coal mined. In some locations in Appalachia the coal severance tax has provided 25% or more of local revenue for Appalachian counties.
The wind industry has tried to sell inself to local governments based primarily on a jobs and property tax revenue model. But Venture Chronicles recently pointed out that wind and jobs don't really go together. And the property tax model has proven to be unstable because many state government exempt wind energy project from property tax after their built – leaving local governments scratching their heads.
The Wyoming proposal would tax the energy generated by commercial wind projects at $3 per megawatt hour. Thatworks out to about a 5% tax. The state would get 60% of that and counties would get 40%. At existing production rates it would generate about $11.5 million a year in tax revenue.