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Coalition to Support Clean Energy members

• Association of Oregon Counties
• Associated Oregon Industries
• Cascadia Green Building Council
• Climate Solutions
• Community Renewable Energy Association
• Drive Oregon
• League of Oregon Cities
• Northwest Energy Efficiency Council
• Northwest Environmental Business Council
• Oregon Conservation Network
• Oregon Environmental Council
• Oregon Forest Industries Council
• Oregon Small Wind Energy Association
• Oregon Solar Energy Industries Association
• Oregon Wave Energy Trust
• Renewable Northwest Project
• Smart Grid Oregon

BETC tales

Do you have a story about how the Business Energy Tax Credit has affected your business? The Coalition to Support Clean Energy wants to hear it. Send your stories to Jamie Hogue of Climate Solutions at [email protected].

When Robert Grott, executive director of the Northwest Environmental Business Council, mentions the looming expiration of the to business owners, their responses are similar: They’re dead in the water without the BETC.

The popular and controversial tax credits for renewable energy projects are set to expire in 2012, and Oregon’s young alternative energy industry is anxious about funding for future projects. As the state grapples with a $3.5 billion budget shortfall over the next two years, the Oregon Legislature is looking to cut programs and not extend them. But without an extension of the tax credits into 2016, Grott believes clean energy companies will leave Oregon for greener pastures in other states.

Excluding large wind developments, the BETC offers tax breaks for up to 50 percent of renewable energy project costs. Tax credits for wind projects larger than 10 megawatts were chopped to 10 percent of project costs this year after the state found evidence that companies were abusing the program.

While many people credit the BETC with creating a clean energy industry in Oregon, others consider it a cash cow because of past abuses, Grott said. That latter perception must be changed, he added, before a coalition of 17 business groups would be able to convince the Oregon Legislature that the tax credit should be extended.

“I mention the BETC and people say it’s hopeless,” Grott said. “It’s not hopeless when there are many voices coming together to say clean energy investment in critical to the state. We need to overcome misinformation and spread the word about the positive return on investment BETC has had.”

The BETC and Oregon’s Renewable Portfolio Standard led to the state gaining its first 2,000 megawatts of wind energy, according to Roby Roberts, Horizon Wind Energy’s vice president of communications and government affairs. Flexible siting rules and the portfolio standard, which requires utilities to purchase a certain amount of renewable energy each year, will keep wind companies in Oregon, Roberts said.

However, newer forms of energy, like solar and biomass, may struggle without the credits. Biomass projects are especially dependent on incentive programs like BETC, according to Linc Cannon, director of forest resources and taxation for the Oregon Forest Industries Council. His group is working to promote biomass projects to spur jobs and revenue in struggling former timber towns. But up-front capital is difficult to obtain for biomass projects, and many constructed facilities rely on BETC to start operations, Cannon said.

“The governor-elect has identified biomass as an area for economic development,” Cannon said. “Everyone is cognizant of the hole in the state budget. But if you want renewable energy in Oregon, whether it’s BETC or something else, we have to have some way to help these new technologies like biomass and wave energy to get over economic hurdles.”

The commercial solar industry has already suffered from BETC cuts, according to Andy Noel, president of the Oregon Solar Energy Industries Association. Losing the funding program completely without an alternative could mean a standstill for projects. If the Legislature were to extend the tax credits through 2016, Noel said businesses would be more likely to consider new projects.

“Right now, people are running a business with uncertainty about funding, which is something we’re used to doing,” Noel said. “But a total expiration takes it to a different level. Commercial solar (in Oregon) has two attractive incentives: BETC and the feed-in tariff, both of which have questions about whether they’ll be around much longer.”

The Coalition to Support Clean Energy is advocating for an extension of the BETC tax credit. But there is a lack of hard facts about the program’s economic benefits, according to Jeff Bissonnette, organizing director for the Citizens’ Utility Board of Oregon, a member of the coalition.

The Oregon Department of Energy has tracked the number of megawatts created via the BETC, but data on job creation is mostly anecdotal. The ODOE is starting a study to track job creation as a direct result of the BETC, but that data won’t be available until midway through the next legislative session. In the meantime, grassroots efforts are necessary to improve the tax credit’s image, Bissonnette said.

“The BETC brand is not good right now,” Bissonnette said. “It’s also not in the budget, which means getting BETC back in the budget. That’s not an easy thing to do. We have to talk about the jobs created and financial benefits that have come back to the state or projects not moving forward today that ought to be to convince people this is a worthwhile program.”

The coalition is asking business owners interested in extending the BETC to submit stories about how they have benefited from the program. The group hopes to gather enough evidence and supporters to sway the Legislature when it meets in February 2011.

“There is no doubt in my mind that the extension of the tax credit is absolutely necessary to keep an energy industry alive in Oregon,” Grott said.