WCAX: Shumlin wants energy fund redesign

Apr 12, 2011 No Comments by

Reposted here from WCAX.


Montpelier, Vermont – April 11, 2011


Vermont now has a little more than $8.5 million in its Clean Energy Development Fund. That fund grants tax credits to builders of solar parks and other renewable energy projects. But since the Vermont Yankee nuclear plant pays into the program, and since Yankee is scheduled to close next year, the Shumlin administration had to come up with a way to keep the development money flowing.


“I really think it’s a win-win,” said businessman Leigh Seddon. Seddon is one of the developers behind Alteris Renewables. The group wants to build Vermont’s largest solar park at the old racetrack in Pownal, on the Massachusetts border. The state is encouraging him with $900,000 in tax credits over five years when the project’s done. But Governor Peter Shumlin, D-Vermont, instead wants to give the project a one-time cash payment of $450,000 upon completion. “That works for us,” Seddon said.


Shumlin says switching the way the state handles its Clean Energy Development Fund will ensure money’s in the pot to entice other projects to break ground. Right now, 23 different businesses are up for credits for nearly 100 projects. The governor calls instant pay-outs of half what companies would get over time a far better way to fund the program than a previous proposal in the House. Lawmakers had been considering tacking a 55-cent surcharge onto Vermonters’ monthly electric bills.


“My challenge as governor is the simple fact that Vermonters on average are making the same money they were making 10 years ago, and their bills have gone up,” Shumlin said.


But some Republicans question Shumlin’s motivation. The Williston company AllEarth Renewables, which makes and designs wind and solar systems, suggested the governor look at the idea. The head of that company was a big donor to Shumlin’s campaign and his firm would get fast cash instead of long-term tax credits if the proposal goes through.


“We, up until last week, had no mention of any of this stuff,” Turner said. “So having a new proposal within three days of the previous proposal is quite concerning to us.”


“It’s an example of government being smart,” Shumlin insisted.


Shumlin says the idea first went through the public service and tax departments, and was floated to many of the companies taking advantage of the fund, not just AllEarth. Plus, the idea isn’t really new: the Shumlin plan is a modified version of the way the federal government handles incentives. That system is already established law.


Some may wonder why developers would take money at 50-cents on the dollar of what they were promised as tax credits. The company that wants to put the solar park in Pownal says it’s still very hard to get funding in this economy, so it thinks investors will be more likely to sign off if they know they’ll get fast cash returns instead of long-term credits.


Again, the cash payments would not go to developers until their projects are complete. And nothing here’s final, either. The change to the way the fund is administered still needs approval from Vermont lawmakers. Republican leader Don Turner says this is just one of the many headaches that will come when Vermont Yankee closes.


Jack Thurston – WCAX News



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