Appendix A. State Wind Profiles: A Compendium

This appendix presents assessments of State-level wind energy programs.⁽⁵⁶⁾ Each assessment begins with the major issue likely to affect wind energy: the status of electricity restructuring and implementation of retail competition in each State.⁽⁵⁷⁾ The assessments follow with information about State incentives and support from green power programs available for wind power (in addition to possible Federal incentives discussed earlier) and ends with the status of wind power development through 2000. A list of sources of information follows at the end of the appendix. This list can be used to obtain more up to date information as needed.

Alabama. Because Alabama is a low-cost State and for other reasons, action on restructuring has been slow to progress. In February 2000 the Public Services Commission scheduled hearings to address two key issues: whether the electric power industry restructuring towards competition is in the best interests of consumers and what the regulatory/jurisdictional role of the Public Services Commission would be in a market-based system. Alabama has a green pricing program starting in 2000 that could promote wind energy when available. Alabama has no existing identified wind capacity and no new wind capacity was planned for 2000.

Alaska. In May 1999, the State Public Utility Commission received a report which investigated the possibility for deregulation in Alaska. Included in the report was consideration of creating retail pilot programs, encouragement of power trading markets, and creation of a central dispatch point and an Independent Systems Operator (ISO). An adjunct effort by the State Senate has reorganized the Public Utility Commission (PUC) into the Regulatory Commission of Alaska and a panel of five new commissioners. In April 2000 a Senate bill was introduced that, if passed, would implement retail choice in the rail belt (Anchorage and Fairbanks) by September 2001.

Alaska has two small wind facilities in rural areas. The one in Kotzebue began with 500 kilowatts (kW) of capacity installed and has plans for future expansion. This project was funded in part by a grant from DOE's Wind Turbine Verification Program. A small 225 kW facility is also located on St. Paul Island. Following the success in Kotzebue, other remote communities are proposing to build new wind facilities. Wales, Alaska, planned to have a new 100 kW facility on line in 2000.

Arizona. Arizona began retail competition for some of its consumers in 1999. This phasing in was to continue until completion in January 2001. In April 2000 the Arizona Corporation Commission approved a renewable portfolio standard that will require utilities and other electricity providers to derive 1.1 percent of their energy from renewable sources (including wind) by 2007. In turn, 50 percent of that must come from solar energy. Funds from the existing system benefits charge may be used for renewable portfolio standard compliance costs.

Arizona has other incentives for renewable energy, possibly including wind. However, they are generally directed towards fairly small operations. Among them is a Qualified Environmental Technology Facilities Credit. This incentive allows a credit toward the personal or corporate income taxes in the amount of 10 percent of the cost of construction of a qualified environmental technology manufacturing, producing or processing facility.

A personal income tax provision allows a 25 percent tax credit on the cost of a solar or wind energy device up to $1,000. The Revolving Energy Loans for Arizona (RELA) Program provides loans up to $500,000 to companies that manufacture renewable equipment or acquire it for use in their own processes. The Solar and Wind Energy Equipment Tax Exemption of up to $5,000 applies to solar and wind energy equipment. Finally, Arizona has net metering provisions depending on the utility's service area. Arizona Public Service Company permits net metering for facilities under 10 kW, while Tucson Electric Power Company allows net metering for facilities under 100 kW.

To date, Arizona has no identified wind facilities and none were planned for 2000.

Arkansas. The status of deregulation is that Senate Bill (SB) 791 will restructure Arkansas' electric power industry and allow retail access by January 2002. In December 1999 the Public Service Commission began work on a series of reports to facilitate implementation of retail competition. No incentives for wind power exist and there are no existing or planned wind facilities identified for 2000.

California. The process of restructuring began in September 1996 when the California State legislature passed Assembly Bill (AB) 1890 to begin restructuring California's electric power industry. The retail electricity market opened officially for all consumers in California on March 31, 1998. The following measures support renewable energy:

• Renewable Setaside. AB 1890 also established a system benefits charge of 0.7 percent on all electricity sold by California's Investor Owned Utilities. Funds (estimated at total of $540 million) would be used to support development of renewable energy during a 4-year transition period to open competition beginning in 1998. Legislation extending the setaside for ten years through January 1, 2012 was signed into law in September 2000. It authorizes collection of $135 million per year for investment in renewable sources.
  
  
• Net Metering. Solar and wind installations equal to or under 10 kW in capacity are eligible.
  
  
• Green Power. Any number of "green power" programs are supported by the "customer side" account portion of the setaside program mentioned above. The customer side account provides rebates of up to 1.5 cents per kilowatthour to customers who purchase energy from renewable electric service providers registered with the Energy Commission. Rebates for industrial customers are limited to $1,000 per year. Renewable products may be marketed using these rebates and/or as part of the separate, private Green-e certified program. To be recognized by the green-e program, a product must have 50 percent or more renewable content and meet other requirements.⁽⁵⁸⁾ Many of these include wind power explicitly in their renewable generation portfolio. Two municipal utilities, Los Angeles Department of Water and Power and the City of Palo Alto, have green pricing programs that promote wind energy.
  
  
• Research and Development. The Public Interest Energy Research Program (PIER) supports the public interest research development and demonstration that utilities were required to do before deregulation. It makes $62 million available annually through 2001.

California has a mature wind industry. At the end of 1998, EIA estimates that California's wind net summer capability stood at 1,487 megawatts (MW).⁽⁵⁹⁾ A number of new and repowered projects with capacity totaling 290 MW came on line in 1999 and nearly 210 MW more were planned for 2000. For details, see the American Wind Energy Association's website: http://www.awea.org/projects/california.html. Further into the future, the new technologies account of the renewable set aside program is expected to support development of some additional new wind capacity.

Colorado. Several bills to allow retail competition and restructure the electric power industry were introduced in the legislature in 1998. None, however, have passed the State legislature. The Colorado Electricity Advisory Panel, created by SB 152, released a final report in November 1999. The majority of the panel opposed restructuring and retail competition, because of their concern that Colorado already has low electricity rates, and that prices might rise under open competition. In addition, it is believed that rate impacts would be disproportionately shared among classes of consumers with low-income, fixed income, rural, residential and small consumers seeing the greatest increases. On another front, the Colorado Public Utilities Commission adopted rules in January 1999 which requires investor-owned utilities (IOU's) to itemize the fuel sources used for "generated and purchased" electricity; thus, increasing public awareness. Unbundled billing has been implemented and the utilities provide this information to customers twice a year. Also, Colorado has net metering for qualified facilities equal to or less than 10 kW in capacity.

Colorado has one investor owned utility with a green pricing program. To encourage development of wind resources, Public Service Company of Colorado (PSCo) has opened its green power program, WindSource. As customers sign up to buy electricity from wind power, PSCo is developing the needed capacity. So far in response to demand, PSCo has put more than 16 MW of wind capacity in operation in Ponnequin, Colorado. In addition, five municipal utilities and three electric cooperatives have green pricing programs to promote wind energy.

Connecticut. The State of deregulation is that phasing in of retail competition began in January 1, 2000. The law also includes a 7 percent renewable portfolio standard to be met by 2009 and a provision for establishing a system benefits charge rising to 0.1 cents per kilowatthour (kWh) to support renewable technologies. Fourteen million dollars is budgeted for the fund in 2000. Connecticut has net metering for renewable facilities under 100 kW. Connecticut has no wind facilities and none were planned for 2000, although Connecticut entities may invest in out-of-State wind projects, power from which would be eligible for complying with the State RPS.

Delaware. The status of deregulation is that Delaware has a law that provides for phasing in retail competition beginning in October 1999, to be completed by April 2001. In September 1999 the Delaware PUC issued final orders for restructuring. Delaware has a public benefit fund for renewable energy and efficiency, but no decision has been made as to how the fund is to be spent. The legislature has enacted net metering for renewable facilities equal to or under 25 kW in capacity. Delaware has no existing wind facilities and no new wind facilities were planned for 2000.

District of Colombia. The District of Columbia PSC approved Potomac Electric Power Company's (PEPCO) restructuring settlement in January 2000. Government and commercial consumers will have retail access, and a pilot program for residential consumers was to begin by January 2001. The District of Colombia has no incentives for wind power, no existing wind projects identified and no new wind facilities were planned for 2000.

Florida. Florida has been slow to take action towards electric utility restructuring. In April 1998, House Bill (HB) 1888 died in committee without a hearing. In April 1999, the legislature adjourned with no further effort taken on restructuring. In January 2000 House issued a report on the state of the electric power industry in Florida. Following that in April 2000 Senate Bill 2020 was introduced and would require a study of electric utility deregulation and energy policy in Florida.

In February 1999, the Public Services Commission ruled that investor-owned utilities must disclose the sources of generation and purchased power to consumers. The Florida Energy Efficiency and Conservation Act of 1980 requires the Florida Public Service Commission to encourage the use of renewables, including wind. Florida has no identified wind facilities and no new facilities were planned for 2000.

Georgia. In early 1998 Georgia's PSC issued a report that investigated electric industry restructuring and made recommendations. No further action has been taken since then. Georgia has no incentives for renewable energy. It has no identified wind power facilities, but a small 1.98 MW facility was planned for 2000.

Hawaii. An April 1999 legislative resolution provided that the PUC submit (prior to the 2000 legislative session) a report on restructuring and competition in electric markets. Hawaii offers an income tax credit allowing individuals and corporations a credit of 20 percent of the cost of equipment and assembly of a residential or non-residential wind energy system to be applied in the year the system was purchased and placed in operation. There is no limit on the total amount of credit. At the end of 1998, Hawaii had wind facilities operating with total capacity of 20 MW. Hawaii had three new projects planned to come on-line in 2000. Potentially they would add a total of nearly 40 MW of wind capacity.

Idaho. Electricity deregulation in Idaho is on hold. Investigations concluded that Idaho is a low-cost State for electricity and should be concerned about prices rising in a competitive market. Idaho has several mechanisms that could support potential wind projects. For example, net metering is available to all technologies with facilities equal to or under 100 kW in capacity, not just renewable facilities. Another incentive consists of a personal income tax credit up to $5,000 for 40 percent of the cost of a solar, wind, or geothermal device used for heating or electricity generation. Low-interest loans are available to residential and commercial consumers for renewable projects to generate electricity for their own use. Projects that intend to sell electricity are excluded. Loan amounts are limited to $10,000 for residential consumers and $100,000 for commercial consumers.

Idaho has no identified wind facilities and none were planned for 2000.

Illinois. Regarding the status of electricity restructuring in Illinois, phasing in of retail competition for industrial and commercial customers was to begin in October 1999 and be completed by October 1, 2000. Residential customers will receive a 5 percent rate reduction by October 1, 2001. In addition, as part of a court settlement, ComEd is required to make a one-time allocation of $250 million to an environmental and energy efficiency fund.

Illinois has a system benefits charge in place that supports renewables including potential wind projects. The charge is a flat rate of $0.50/month for residential and small commercial customers. Larger customers pay $37.50/month. The fund is budgeted for $5 million every year for 10 years. Fifty percent of the funds collected go toward the Renewable Energy Resources Trust. Effective April 2000, Commonwealth Edison established an experimental net metering program for solar or wind generating systems equal to or less than 40 kW in capacity. Illinois has no identified wind facilities and none were planned for 2000.

Indiana. In March 1999 a restructuring bill, HB 648, was introduced, but failed to move beyond a committee hearing. It was opposed by utilities, organized labor, and consumer and environmental groups. Indiana has several incentives for renewables that can benefit the development of wind power. First is the property tax incentive, which exempts from property taxes the entire renewable energy device and affiliated equipment. Second is net metering for qualifying facilities generating less than 1,000 kWh per month. To date, this incentive has benefitted operators of small wind turbines. The third is demand side management programs. The Indiana Utility Regulatory Commission's 1995 ruling on demand side management programs allows for the inclusion of renewable energy systems (including wind facilities) in such utility programs. Indiana has no wind facilities identified and there were no plans to build any in 2000.

Iowa. According to data from the American Wind Energy Association, Iowa had a number of small wind facilities in operation before 1999. Some of these facilities were too small to be included in EIA data and some were just not yet reporting. They included a 2.25 MW project in Algona, Iowa, developed by Cedar Falls Utilities using Zond designed equipment with support from the DOE/EPRI Turbine Verification Program. In 1999, a 1990 State law, mandating that utilities in Iowa collectively take an average of 105 MW of electricity from renewables, was a factor (although not the only one) in the major development of approximately 240 MW of new wind capacity. This development includes some of the following facilities:

• 112.5 MW in Alta, Iowa, developed by Enron using Zond  equipment  to  sell  power to MidAmerican
  
  
• 80.2 MW in Alta, Iowa, developed by Enron and Northern Alternative Energy (NAE) using Zond equipment to sell power to Alliant/IES
  
  
• 42 MW in Clear Lake, Iowa, developed by FPL using NEG-Micon equipment to sell power to Alliant/IES.

Other factors influencing development include the following State provisions:

• Grants for Energy Efficiency and Renewable Energy. Sponsored by the Iowa Energy Center, these grants include support for a wide variety of research activities, including among them wind resource assessment.
  
  
• Guaranteed Buy Back Rates. Within certain set limits, utilities are obligated to purchase renewable power at incentive buy back rates which are higher than the utilities' avoided cost.
  
  
• Alternative Energy Loan Program. This program offers 0 percent interest loans for up to half of the project cost with a maximum of $250,000 for entities in the residential, commercial, and industrial sectors.
  
  
• Property Tax Incentive. Any city or county in Iowa has the option to assess wind energy equipment at a special valuation for property tax purposes following State guidelines. For the first year, wind energy conversion equipment is assessed at 0 percent of the total cost. In the second through the sixth years the equipment is assessed at an additional 5 percent per year. From the seventh year onward, the assessment is set at 30 percent of total cost.
  
  
• Sales Tax Incentive. This statute exempts from Iowa State sales tax the total cost of wind energy equipment and all materials used in the manufacture, installation, or construction of wind systems.
  
  
• Net Metering. This ruling allows Iowa customers with alternative energy generation systems to sell electricity back to the utilities on a netted basis. Utilities are obligated to buy excess electricity at their avoided cost. To date, this program has not been particularly popular due to impediments imposed by the utilities.
  
  
• Research and Outreach Programs. The Iowa Energy Center has been involved in assessing the State's wind resources and developing a model to be used for siting wind turbines. It also administers a loan program which offers 0 percent interest loans for up to half the project cost up to a maximum of $250,000 and as long as funds allocated for wind portion of the renewable loan program are available.

In addition, one municipal utility, Cedar Falls has a green pricing program to promote wind energy.

The status of deregulation in Iowa is that a proposed restructuring bill died at the end of the legislative session in Spring 2000. The Iowa Department of Natural Resources proposed adding a renewable portfolio standard with a goal of 4 percent renewable electricity by 2005 and 10 percent renewable electricity by 2015, but the restructuring legislation failed to pass. A 600 kW wind project was proposed for Spirit Lake to come on-line in 2000.

Kansas. The status of deregulation is that several bills were introduced in the 1999 legislative session to restructure the electric power industry, but no action was taken before adjournment. There are two existing programs that include incentives for wind power development.

• Renewable Energy Grant Program. This provides support in small amounts of funds (less than $50,000) for development of renewable energy, including wind, and excluding research and development.
  
  
• Kansas Electric Utilities Research Program (KEURP). is a cooperative venture among seven electric utilities performing applied research to proactively seek and deliver technologies enhancing the value of electric services to its members, utility customers, and the State of Kansas. In the past this has included a collaborative project with DOE to conduct a wind siting study.
  
  

In addition, two investor owned utilities have green pricing programs to promote wind energy exclusively. So far, Kansas completed one small 1.5-MW wind project in 1999 and has no plans for any new wind facilities in 2000.

Kentucky. The Kentucky Task Force on Electric Restructuring, established by HRJ95, completed its final report and found that retail prices in Kentucky could rise under open competition. Kentucky has one municipal utility sponsoring a green pricing program that can promote wind energy when available. Kentucky has no incentives for renewable energy, no identified wind facilities, and no new wind facilities were planned for 2000.

Louisiana. In March of 1999 the Public Services Commission issued an order stating that "...a deliberate and cautious approach is still warranted" for restructuring the electric industry. A schedule was set to study the issues through August 2000. Louisiana has no incentives for wind energy, no existing wind facilities identified, and no new wind facilities were planned for 2000.

Maine. The Restructuring Act of 1997 allows electric power to be sold directly to retail consumers by largely deregulated power providers competing with one another beginning March 2000. By the end of 1999 the Maine PUC had finalized rules necessary to implement restructuring on schedule. Electric bill charges were to be unbundled beginning in 1999. Maine has the highest renewable portfolio standard in the United States-- some 30 percent. However, counting electricity from hydropower, biomass, and gas cogeneration, Maine already exceeds this using existing renewable capacity. Maine also has a net metering program for small facilities under 100 kW in capacity. Recently, Maine revised the net metering program to be consistent with retail access. Under the old provisions customers could sell excess power to the utility. According to new provisions customers will accumulate a rolling credit, which will roll over for 12 months, after which the credit goes away. Maine has no currently identified wind facilities, but a 20 MW project on Reddington Mt. was in the process of being permitted with plans to be on line by December 2000.

Maryland. Restructuring legislation provides for a phase-in of retail competition starting in July 2000 and ending July 2002. In January 2000 the Maryland PSC approved PEPCO's restructuring plan and PEPCO customers were scheduled to begin retail direct access by July 2000. While Maryland has several incentives for solar energy, it has no incentives for wind, no identified wind facilities, and no new wind projects were planned for 2000.

Massachusetts. Open retail competition began in March 1998. Accompanying restructuring is a renewable portfolio standard that includes wind. Retailers are required to take 1 percent of their supply from new renewables in 2003. This requirement increases by 0.5 percent per year until 2009, and 1 percent per year thereafter. To support implementation of the renewable portfolio standard, Massachusetts also has mandated the disclosure of fuel mixes to end use customers. The State has also established the Massachusetts Renewable Energy Trust Fund, which is supported by a system benefits charge which began collection in 1998. Implementation of the full program is proceeding and includes potential benefits for wind. Massachusetts also has a net metering program for all qualified facilities (as defined by PURPA and FERC) at or below 60 kW of capacity according to legislation enacted in 1997. Net excess generation is purchased at the electric utilities full avoided cost.

Massachusetts has various other renewable incentives of less importance, including the following. The State has an alternative energy patent exemption, which offers both corporate and personal income tax deductions for any income received from the sale of a patent or collection of royalties for patents that benefit development of alternative energy for 5 years from the time the deduction is granted. A corporate income tax credit permits corporations to deduct solar or wind expenditures for space or water heating from their taxable income. The State also exempts solar and wind facilities from corporate excise tax for the length of the project's depreciation period. Massachusetts has a special grant program for partnerships with the private sector and local communities. These grants support development of fuel cells, wind, and solar photovoltaics.

The State's renewable energy systems credit provides for a 15-percent credit (with a maximum limit of $1,000) against State income tax for the cost of a renewable energy system installed at an individual's primary residence. The local property tax exemption for solar, wind, and hydro exempts these facilities from local property taxes. Massachusetts also exempts from State sales tax, solar, wind, and heat pump systems operating in an individual's primary residence.

Massachusetts has only two small wind facilities identified--each with capacity under 0.5 MW. One new wind project with capacity of 7.5 MW was planned for 2000.

Michigan. Recently enacted electricity restructuring legislation allows all customers retail choice by January 2002. One way Michigan supports wind is with a program, Green Rate, in which customers pay a monthly premium to have all their power sourced to the Traverse City 600-kW wind project. Great Lakes Energy Cooperative has a second green pricing program to promote wind power. There were no other plans to add wind capacity in 2000.

Minnesota. So far, electric power restructuring has had little effect on wind power development. Although restructuring legislation was introduced to both the House and Senate, it never passed. Of far greater importance to wind energy development in Minnesota is a unique "quid pro quo" law regarding storage of spent nuclear fuel. A law passed in 1994 allows Northern States Power (NSP) to store nuclear waste in dry caskets near one of its nuclear power plants in exchange for a commitment to develop new wind capacity. According to plan 425 MW of wind power capacity would come on line by 2002 with 400 more megawatts to follow by 2012.

This legislation is not the only factor affecting development. Minnesota has a number of State incentives and programs that, when taken in combination, can help make wind projects viable. These incentives include:

• Corporate Income Tax Credit. Minnesota has accelerated depreciation provisions in the State tax code that mirror the federal Modified Accelerated Cost Recovery Schedule (MACRS). That is a 5-year, 200-percent double declining balance accounting method.
  
  
• Special Grant Program. Minnesota provides a 1.5 cent per kilowatthour grant for 10 years to wind projects 2 MW or smaller in size on a first come first served basis up to a statewide total of 100 MW wind power capacity. This program is meant to encourage establishment of dispersed wind generation infrastructure.
  
  
• Agricultural Improvement Loan Program. This program provides low interest loans up to $100,000 to farmers for improvements or additions to permanent facilities. Wind energy conversion equipment has qualified since 1995.
  
  
• Value-Added Stock Loan Participation Program. This program can provide small, low-cost loans to farmers wishing to buy into wind generation cooperatives. There has been very little activity for wind in this program thus far, because the maximum amount of capital available is usually insufficient to finance even a small wind project.
  
  
• Property Tax Exemption. This provision excludes from property taxation all or part of the value added by wind systems. The value is determined on a sliding scale. Some small systems have the total value exempt, while all systems 12 MW or greater in capacity have 25 percent of the value taxed.
  
  
• Sales Tax Incentive. Minnesota exempts from sales tax the total cost of wind energy devices, including equipment and all materials used to manufacture, install, construct, or repair such systems.
  
  
• Easements. Minnesota provides for wind easements. An easement that benefits the property cannot add value to the property for tax purposes.
  
  
• Green Pricing. Minnesota has one investor owned utility (Minnesota Power), four electric cooperatives, and one municipal utility promoting wind power to customers who wish to pay a premium for clean energy.
  
  
• Net Metering. Minnesota offers net metering to wind facilities with 40 kW of capacity or less. Utilities must purchase any excess power generated at the average retail rate.
  
  
• Public Benefit Fund. In addition to developing wind capacity in exchange for storing nuclear waste, the 1994 law also required Northern States Power to contribute $4.5 million to a fund beginning in 1999 and equal or greater amounts in successive years. These payments would continue indefinitely until either the law is changed or the casks can be shipped to a national nuclear-waste storage or disposal site. Money in this fund will be used to help finance projects that produce electricity from nontraditional sources and also benefit local economies in Minnesota.

With the support of the federal production tax credit, the 1994 State law, and various other State incentives, Minnesota brought on line nearly 140 MW of wind generating capacity in 1999. The following facilities are representative of those that came on line in 1999:

• 107.25 MW in Lake Benton, Minnesota (Lake Benton I), developed by Enron using Zond equipment.
  
  
• 103.5 MW in Pipestone County, Minnesota (Lake Benton II), developed by Enron using Zond equipment and now owned by FPL Energy, LLC.
  
  
• 11.25 MW in Lakota Ridge, Minnesota, developed by Northern Alternative Energy using NEG Micon equipment
  
  
• 11.88 MW in Shaokatan Hills, Minnesota, developed by Northern Alternative Energy using Vestas equipment.

Furthermore, facilities with a total of 30 MW capacity at 17 dispersed sites were to be developed by Northern Alternative Energy with plans to be on line by the end of 2000.

All of the projects listed above have power purchase agreements with Northern States Power. Additional wind capacity, being proposed, is expected to be developed in the future to meet Northern States Power's complete long-term commitment under the 1994 law. Also, a 1.98 MW project for Chandler Hills is in the preliminary stages of planning.

Mississippi. Pending enactment of authorizing legislation, Mississippi's electric power suppliers were set to implement retail competition starting January 2001 and ending December 2004. The City of Oxford, North East Mississippi Electric Power Association, has a green program that started in 2000 that can promote wind energy when available. Mississippi has no identified wind facilities and no new wind capacity was planned for 2000.

Missouri. Several bills to restructure the electric power industry and allow retail access were introduced in the legislature in the winter of 1999, but none were passed. Missouri has a loan program for renewables and potential wind projects. Funds are loaned to schools, local governments and small businesses. One investor owned utility, Missouri Public Service (Utilicorp United) has a green pricing program to promote wind power when it's available. Missouri has no identified wind facilities and had no plans to build any in 2000.

Montana. The status of deregulation in Montana is that retail competition is being phased in with a targeted end date of July 1, 2002, though extensions may be granted up to July 1, 2006 (depending on the utility and service area involved). Montana has required since May 1997 that electric bills be unbundled. In terms of renewable energy support, Montana has a number of incentives that could be applied to wind and these will be detailed here. However, the State has no existing wind facilities identified and had no plans for any capacity additions in 2000.

Montana has a system benefits charge that went into effect July 1, 1999, and will continue 4 years until July 1, 2003. Electricity suppliers will contribute 2.4 percent of their 1995 revenues to the fund. Electric utilities will be responsible for spending the monies. Funds allocated to renewable energy could be spent for wind to conduct research and development (R&D) or to actually build a facility.

Montana's support programs also include the following. First is net metering, which can apply to wind generators with capacity equal to or under 50 kW. There is also an income tax credit that could apply to wind. This program allows a 35-percent tax credit for an individual, partnership, or corporation that makes an investment of $5,000 or more in wind electricity generating system or facilities to manufacture equipment. Another provision of Montana law exempts from property taxation the value added by a qualified renewable energy source, including wind. Montana is also one of four States that provides for the creation of wind easements for the purpose of protecting and maintaining proper access to sunlight and wind. Finally, one electric cooperative has a green pricing program that can promote wind.

Nebraska. Nebraska has been exploring electricity restructuring, but this effort is still in the investigative stage. Nebraska has several programs that could benefit potential wind projects, including a wind easement law. This law allows property owners to create binding wind easements for the purpose of protecting and maintaining proper access to wind energy. Another is a low interest loan program that can support development of future wind projects. Finally, one municipal utility has a green pricing program promoting wind power. Nebraska has one 1.5 MW wind facility on line in Springview not yet included in EIA data (but supported in part by the DOE Wind Turbine Verification Program), and one 1.32 MW wind facility operating in Lincoln. No additions were planned for 2000.

Nevada. In June 1999, Nevada enacted new restructuring legislation, which amended a 1997 law. The PUC has set a schedule to begin retail competition for the largest commercial customers in November 200. Retail competition will be open to all customers by the end of 2001.

Nevada has a few incentive programs for wind, but none of particular significance. These programs include a renewable portfolio standard requiring utilities to have 0.2 percent of their electricity from renewables by January 1, 2001 increasing to 1 percent by 2009. Half of that is required to be solar. There is also a net metering law, but only for facilities of 10 kW capacity or less and only for the first 100 customers of each utility. A property tax incentive provides that any value added by a qualified renewable energy source shall be subtracted from the assessed value of any residential, commercial or industrial building for property tax purposes. Nevada has no identified wind facilities and none were planned for 2000.

New Hampshire. The State enacted HB1392 in 1996, requiring the PUC to implement retail choice by July 1998. However, implementation of restructuring was delayed due to continuing Federal litigation concerning the PUC's efforts to set stranded costs and rates for Public Service of New Hampshire (PSNH). In June 2000 SB472 was signed into law. This legislation is aimed at lowering PSNH's rates and allowing customers to choose an energy supplier. In September 2000 the New Hampshire Public Utilities Commission issued orders approving PSNH's restructuring settlement agreement and a schedule for phasing in retail competition will be set.

New Hampshire has several small-scale support programs which could apply to wind, if facilities were built. The first of these includes a net metering provision, which is currently under revision by the State PUC. Under new rules there would be full net metering and credits would roll over at the end of each month. Capacity would be limited to 25 kW. Second, a demonstration grants program provides grants between $5,000 and $10,000 for renewable demonstration/education projects. In a recent year, all the grants were for PVs, although wind is eligible. Third, a local option property tax statute allows each city or town to offer an exemption on residential property taxes in the amount of the assessed value of the eligible renewable energy system used on the property.

New Hampshire has no identified wind facilities and had no plans for building any in 2000.

New Jersey. In February 1999, the State enacted legislation to restructure New Jersey's electric power industry, providing for the beginning of retail competition in August 1999. Since then, one agreement between the Board of Public Utilities and Connectiv provided for a delay of retail competition until November 1999. New Jersey has a number of support programs for renewable energy development. First, New Jersey also provides for a 4-percent renewable portfolio standard to be met by 2012 using non-hydroelectric sources of renewable energy. Second, New Jersey has a public benefit fund that will total $265 million for 2000-2008. Wind is an eligible technology. However, the New Jersey Board of Public Utilities has yet to issue a final rule on how these will be administered. In addition, since 1999 New Jersey has had net metering for wind and PV generators with no limit on generator size. Another incentive for renewables is the exemption from New Jersey's 6 percent State tax. New Jersey has no identified wind facilities and had no plans for any in 2000.

New Mexico. Legislation to restructure New Mexico's electric power industry was enacted in April 1999. According to current plans, consumer choice will begin with residential and other small consumers in the beginning of 2002, followed by other larger users at a later date. The restructuring legislation contains a provision for a system benefits charge to be levied on all kilowatt-hour sales in New Mexico. These funds will be used by the New Mexico Department of Environment to support activities including development of renewable energy by school districts and the governing entities of cities towns and villages. New Mexico also has a limited renewable portfolio standard. It provides for up to 5 percent of electricity to come from renewable resources by 2002 if it can be shown renewable resources are available in New Mexico and if the cost of standard offer service does not increase.

New Mexico also has a net metering program that benefits small renewable facilities under 10 kW in capacity. The State has one investor owned utility, Southwestern Public Service, with a green pricing program that can apply to wind energy. New Mexico has one small wind facility in operation, a 0.66 MW facility in Clovis and no new facilities were planned for 2000.

New York. With regard to electricity industry restructuring, New York is currently phasing in retail competition statewide. Each utility has its own timetable of targets. Some utilities have reached full retail access, while others expect to by the end of 2001. Although it is not entirely clear how the industry will change as restructuring transpires, New York presently has some support for renewable energy (including wind). In the past, a surcharge levied on intrastate sales of gas and electricity by investor-owned utilities provided funds for, among other things, research, development and commercialization of renewable technology as well as financial support to further market penetration of renewable energy. For the future, the New York Public Services Commission ordered utilities to provide unbundled billing by April 2000, which will identify electricity provided by green sources. Also, the PSC has set rules for a new system benefits charge to fund R&D for renewable energy. The fund will run through 2001 and be administered by the New York State Energy Research and Development Authority (NYSERDA). New York has net metering, but it is for solar only and does not apply to wind energy.

One 11.5 MW facility was planned by PG&E Generating for Madison, New York, to be on line in 2000. Some of the electricity is intended to be sold to green power providers. NYSERDA will provide $2 million as assistance. A small project was planned for Wyoming county to come on line in 2000.

North Carolina. Restructuring is under investigation in North Carolina. In March 1999, the Research Triangle Institute submitted its report with recommendations to the North Carolina Public Utilities Commission, but no further action was expected in 1999. In April 2000 the Study Commission, which was established by Senate Bill 38 in 1997, issued its final report. It recommends opening retail electricity markets to half of consumers by January 2005 and the remainder by January 2006, as well as, creating a public benefits fund that could benefit renewables. It also proposed providing a choice for green energy or alternatively a renewable portfolio standard.

Presently, North Carolina has one incentive that could support wind energy development. The income tax credit provides a credit against corporate and personal income taxes in the amount of 10 percent of the cost of equipment and installation of a wind energy system not to exceed $1,000 for any single installation. North Carolina has no wind facilities identified as in operation and none were planned for 2000.

North Dakota. In November 1998, the Electric Utilities Committee submitted its report to the legislature on restructuring, but no action has yet been taken. The next legislature meets in 2001. North Dakota has several incentives that could support wind energy. The personal income tax credit allows any taxpayer to deduct 5 percent of the cost of equipment and installation of a geothermal, solar or wind energy device for a period of 3 years. The property tax incentive exempts from local property taxes any solar, wind, or geothermal energy device for the first 5 years of operation. North Dakota also has a net metering program for renewable generators equal to or under 100 kW in capacity. In North Dakota Minnakota Power Cooperative has a green pricing program to promote wind energy development. North Dakota has a few small identified wind facilities too small to be included in EIA survey data. Two are operated by Indian tribes. Together, these facilities represent less than 0.5 MW of capacity. No new wind facilities were planned to come on line in 2000.

Ohio. In July 1999, Ohio enacted legislation to restructure the Ohio's electric power industry. In October 1999, the PUC issued an initial set of rules for transition to a competitive market. Since that time a number of utilities have submitted transition plans for PUCO's approval. Retail competition was to be phased in beginning January 1, 2001. Ohio has net metering available for wind facilities with no size limit on the generator. Ohio's tax system exempts certain equipment, including wind generators, from property taxation, the State sales and use tax, as well as the State franchise tax where applicable. Ohio has no identified wind facilities and none were planned for 2000.

Oklahoma. In April 1997, SB 500 was enacted to provide for electricity restructuring. It targeted retail competition to begin July 2002. Subsequently, SB 888 was enacted, which would bring in retail competition earlier. In October 1998, the Joint Electricity Task Force began a series of studies on implementing restructuring. The last of these studies was to be completed by October 1999. In late Spring 2000 the State legislature was working on a compromise bill to establish rules for implementing electric power industry restructuring. Oklahoma has a provision for net metering that could benefit wind energy development. Customers can request the utility to pay for extra power generated, but the utilities are not required to comply. Oklahoma has no identified wind facilities, and none were planned for 2000.

Oregon. In July 1999, Oregon enacted legislation that will deregulate the electric power industry and allow for customer choice.⁽⁶⁰⁾ The law will phase in open competition for industrial and commercial customers, but residential customers will have a portfolio of electricity products from which to choose. Products are provided by the incumbent utility and include a green power option. Generation companies will be chosen by the utility through competitive bidding, acting as a middleman for residential customers. The bill also requires disclosure of fuel sources, emissions and price, and creates a "public purpose fund" with funds set aside for renewables including wind. Beginning in October 2001 renewables would receive about 17 percent of the fund each year for 10 years. Separately, the governor signed into law a bill to implement net metering for renewable facilities less than 2.5 kW in size.

Oregon already has some other renewable incentives in place. The first is the corporate income tax that permits a 35-percent investment credit up to $100,000 for construction of systems that produce energy from renewable sources, including wind. The second is the Small Scale Energy Loan Program (SELP). A 1980 amendment to the Oregon constitution authorizes the sale of bonds to finance small-scale, local energy projects, potentially including wind. Third, Oregon's property tax exemption for renewable devices states that the added value to any property (whether residential, commercial, or industrial) derived from the installation of a qualifying renewable energy device shall not be included in the assessment of the property's value for property tax purposes. The fourth is net metering for wind generators with capacity equal to or under 25 kW.

Oregon has four green pricing programs supporting wind energy development. They are sponsored by two investor owned utilities, one electric cooperative, and one municipal utility. One example is Portland General Electric's (PGE) green pricing program open to large industrial and wholesale customers. PGE has contracted to supply this program in part with energy from Oregon's existing wind farm, the 24.9 MW Vansycle facility, which started operations in December 1998. No new wind facilities were planned for either 1999 or 2000.

Pennsylvania. In 1999, Pennsylvania began phasing in retail competition in stages. In September 1999, utilities were required to mail information packages to all consumers that had not chosen a competitive supplier with the hope of getting them in the new system by January 2000. Disclosure of fuel mix is encouraged. In addition, Pennsylvania has an RPS, SBC, and net metering, but provisions vary for each utility service territory. Separately, the PECO Unicom merger established a fund that has $12 million budgeted for wind over a 5-year period.

Pennsylvania also has green power programs that could benefit future wind projects, when they are built. Green Mountain Energy opened its program in 1998 and sells three products: electricity with 1-percent, 50-percent, and 100-percent renewable sources at a modest increase in cost compared to traditional energy sources. Another program, Connectiv Energy is the first program in Pennsylvania to be certified by the green-e program. It offers Nature's Power 50 and Nature's Power 100 made from 50-percent and 100-percent renewable energy, respectively. The Energy Cooperative Association sponsors another green power program. Pennsylvania has one 10 MW wind facility, owned by American National Power, which was dedicated in May 2000 in Somerset County, Pennsylvania. Green Mountain Power markets power from this facility. A new 15.6 MW wind facility at Mill Run in Fayette County was planned to go on line in 2000.

Rhode Island. The Rhode Island Utility Restructuring Act of 1996 provides for electricity restructuring and open retail competition was to be phased in during 1998. By September 1999 only a small number of consumers had chosen alternative electricity providers. Rhode Island has a non-bypassable system benefits charge to support the development of renewable energy and demand side management programs. The charge is set at $.0023 per kilowatthour for a minimum of 5 years beginning in 1996. Rhode Island also has a net metering program created in 1985 that benefits a few small wind generating facilities equal to or under 25 kW in capacity. Rhode Island had no plans for new wind facilities in 2000.

South Carolina. With regard to deregulation, the South Carolina legislature discussed a new bill introduced in the Senate and debated the issues in the Spring of 2000. The Bill did not pass that session. South Carolina has no incentive programs for wind energy development, and no existing wind facilities identified. No additions were planned for 2000.

South Dakota. Deregulation in South Dakota has been under investigation. Findings of these activities assert that restructuring would not be good for South Dakota. Because the State has some of the lowest rates in the Nation, it is expected electricity prices would go up under open retail competition. Existing law permits retail wheeling for new, large customers.

South Dakota has a property tax incentive that exempts renewable energy systems on residential and commercial property from local property taxes for 3 years after installation with certain restrictions. The East River Electric Cooperative has a green pricing program that can promote wind energy planned to start in 2000. South Dakota has no identified wind facilities, but the Rosebud Sioux tribe had a 750 kW facility planned to come on-line in 2000.

Tennessee. Because the TVA provides most of Tennessee's electricity cheaply, little interest exists in restructuring the electric industry, although it has been investigated. Tennessee has a loan program that offers loans up to $100,000 for renewable projects including wind. The Tennessee Valley Authority (TVA) has a green power program that could apply to wind energy when available. Tennessee has no existing wind projects identified, but TVA proposed a 1.98 MW project for Buffalo Mountain in Anderson County to come on line in 2000.

Texas. Texas enacted legislation to restructure the electric power industry and permit retail competition. The State's electricity industry will begin open competition by 2002, and by 2009 State utilities will be required to develop 2,000 MW of new renewable-based power. Some of this capacity could use wind energy. This would achieve a standard of about 3 percent renewable electricity for utilities by January 2009. By the winter of 2000 rules to implement the standard were finalized by the PUC.

Prior to this, in October 1998, the Texas PUC adopted a renewable energy tariff rule that allows all utilities in Texas to offer customers the opportunity to buy renewable energy. If a utility chooses to offer a renewable energy tariff, its customers buying renewable energy may be charged a premium above their standard energy cost to cover any cost of a renewable resource that exceeds the utility's average system cost, plus marketing costs and possible utility profit. Two utility green pricing programs are sponsored by the investor owned utilities: TXU Electric and the Texas-New Mexico Power Company. Two municipal utilities also have programs. Texas also has net metering for renewable generators with capacity equal to or under 50 kW.

By the end of 1999 Texas had three large wind facilities on line. They were (1) Culberson County with 65 MW of Kenetech and Zond turbines, (2) Big Spring, Texas, with 35 MW of Vestas Turbines, and (3) McCamey, Texas, with 75 MW of NEG Micon turbines. In addition, several smaller projects, including the 6 MW facility in Fort Davis, Texas, received support from the DOE Wind Turbine Verification Program. Two new projects were planned for 2000. One was a 21.6 MW facility in King Mountain and the other is a 3.5 MW plant in Fort Stockton.

Utah. Deregulation in Utah is under investigation. Utah has a renewable energy income tax credit. For residential systems, the credit is 25 percent of the cost of installation up to $2,000 per system. For commercial systems, the credit is 10 percent of the cost of installation up to $50,000 per system. Utah has no identified wind facilities operating, but a 225 KW facility in Camp Williams, Riverton, was planned for 2000. Utah Power (Pacificorp) has a new green power program that could apply to wind energy when available.

Vermont. Alternative proposals for restructuring date back as early as December 1996, but the issue of stranded costs has been a stumbling block to enacting any legislation. At present, all of the utilities have power purchase contracts with Hydro Quebec and local independent power producers that are above market price. To provide a path to a solution, the Department of Public Service has already permitted temporary rate increases, until contracts can be renegotiated. According to restructuring plans filed with the Public Service Board in March 1999, Central Vermont Public Service and Green Mountain Power will divest themselves of their major generating assets and merge into one distribution company. Other details have yet to be announced. Vermont has net metering for small wind facilities with capacity equal to or under 15 kW or for farm system generators 100 kW or less in size.

Vermont has one 6 MW wind facility in operation in Searsburg, Vermont, not yet included in EIA data. This project was supported in part by a grant from the DOE Wind Turbine Verification Program. Vermont also had plans for new wind facilities in 2000.

Virginia. Early in 1999, the Virginia Electric Utility Restructuring Act was signed into law. It provides for retail competition to be phased in beginning January 1, 2002, through until January 1, 2004. Virginia has recently enacted net metering for residential wind generators with capacity equal to or under 10 kW and for non-residential wind generators 25 kW or less in size. Virginia has no existing wind facilities identified and had no plans for new wind facilities in 2000.

Washington. In October 1999, a plan--Reliability 2000--to restructure the electric power industry was proposed, but has yet to be passed. Among programs that could support wind projects, one is an exemption from the State corporate excise tax. Another is net metering for wind generators 25 kW or less in capacity. A third type of support is Washington's research and outreach programs that provide prospective renewable developers technical assistance, education, workshops, and other field assistance. Washington has three utility green pricing programs that can promote wind energy when available. Washington has no existing wind facilities identified and none immediately planned for 2000.

West Virginia. In March 2000 the legislature approved the Electricity Restructuring plan submitted by the Public Services Commission. It will allow retail choice by January 2001. West Virginia has no existing wind facilities identified and none were planned for 2000.

Wisconsin. Wisconsin is one State that has not restructured its electric power industry, but it has a renewable portfolio standard and public benefits fund. Early legislation signed into law in April 1998 mandated utilities to create 50 MW of power from renewable sources by 2000. Subsequently, Wisconsin's "Reliability 2000" legislation went into effect in October 1999. In addition to overhauling the State's transmission system, the law provides for an RPS and PBF. The RPS provision requires 0.5 percent of retail energy sales to come from renewable energy sources (excluding electricity from hydroelectric facilities 60 MW and higher in capacity). This percentage would be boosted to 2.2 percent in 2011. A small portion of the public benefits fund would go to encourage the development or use of renewable applications. Some of these renewable provisions could benefit wind energy development in the future.

A number of other incentives for wind energy already exist:

• Solar and Wind Energy Equipment Exemption. This tax incentive exempts taxpayers from any value added by a qualified renewable energy source for property tax purposes.
  
  
• Solar and Wind Access Laws. Wisconsin statutes allow property owners with wind or solar energy systems to apply for permits which will guarantee unobstructed access to solar and wind resources.
  
  
• Net Metering. Net metering is available to all customer classes for  systems  with capacity of 20 kW or less. For electricity from renewable energy the utilities pay the retail rate for net excess generation.
  
  
• Green Pricing. Madison Gas and Electric plans to offer a green pricing program to support its new 11.22 MW wind farm in eastern Wisconsin. Customers can choose to purchase 100 kWh blocks for a monthly premium of around $5. Wisconsin Electric's pilot program, Energy for Tomorrow, with 9,000 participants was so successful it is being extended to more customers.

A Clean Energy Rebate Program was proposed in State Senate Bill 56 introduced in February 1999. Under its provisions, an individual may receive a rebate of up to $2,000 from the State for installing a wind or solar system.⁽⁶¹⁾ Madison Gas and Electric and the Wisconsin Electric Power Company are two investor-owned utilities with green pricing programs to promote wind energy; in addition, one electrical cooperative has a program.

By the end of 1998, Wisconsin had one 1.2 MW facility on line in De Pere, Wisconsin, (supported in part by the DOE Wind Turbine Verification Program) not yet included in EIA data. Three facilities followed in 1999. They were (1) Nagara Escarpment-11.2 MW of Vestas turbines, (2) Lincoln Township-9.24 MW of Vestas turbines, and (3) Byron-1.32 MW of Vestas turbines. There were no plans for any new wind facilities immediately in 2000.

Wyoming. The Wyoming Public Service Commission issued a paper analyzing electric industry restructuring in September 1997. Some follow-up action was taken, but no further activity of significance has taken place since June 1998. Wyoming has only one renewable incentive, a solar/wind access law which provides very little benefit to wind energy. On the other hand, some of the wind power being developed in Wyoming is to be used to support diversified programs in other States such as Colorado. Pacific Power (Pacificorp), an investor owned utility, has a green power program.

Wyoming has two large projects in Foote Creek Rim. The first is a 41.4 MW facility that came on line in mid-1999. Average wind speeds are 25 miles per hour at the site, thus promising greater potential for wind generation. The project is owned 80 percent by PacifiCorp, an investor-owned utility based in Portland, Oregon, and 20 percent by Eugene (Oregon) Water and Electric Board, a municipal utility. Sea West and Tomen Corporation built the project using 69 Mitsubishi turbines. The second Foot Creek Rim project was Public Service Company's (PSCo) 25 MW project nearby. It uses 33 750-kW turbines manufactured for the most part by NEG Micon's new facility in Illinois. Other projects include Foot Creek Rim III, a small 1.8 MW facility developed by Seawest and Tomen Power for Bonneville Power Administration, and a 3.3 MW facility by Fort Collins Light and Power (of Colorado) in Medicine Bow.

An additional 10 MW facility on Simpson Ridge was planned for completion in 2000. In mid-2000 Bonneville Power announced another purchase power agreement with Seawest to construct a new wind facility and provide more green power. According to plans the new Foot Creek Rim IV project was to have 28 wind turbines with a total capacity of 16.8 MW and be operating by the end of 2000. A small 1.32 MW project in Medicine Bow was planned to be on line during the summer of 2000.

Sources ⁽⁶²⁾

Information on restructuring the electric power industry was taken from the following websites:

EIA's Status of State Electric Utility Deregulation Activity, website:
http://www.eia.doe.gov/cneaf/electricity/chg_str/tab5rev.html

U.S. Department of Energy, Electric Utility Restructuring Weekly Update, website:
http://www.eren.doe.gov/electricity_restructuring/weekly.html

Strategic Energy Ltd's Electricity Competition Update, website:
http://www.sel.com/

and

Electricitychoice.com, website:
http://www.electricitychoice.com/

Information on State incentives and green pricing was taken from:

North Carolina Solar Center's Database of State Incentives for Renewable Energy (DSIRE), website:
http://www.ncsc.ncsu.edu/dsire.htm

K. Porter, National Renewable Energy Laboratory (NREL), and R. Wiser, Lawrence Berkeley National Laboratory, "A Status Report on the Design and Implementation of State Renewable Portfolio Standards and System Benefit Charge Policies," presented at Windpower Conference 2000 (Palm Springs, California, May 2000). See the NREL website: http://www.nrel.gov/analysis/emaa

U.S. Department of Energy, The Green Power Network website:
http://www.eren.doe.gov/greenpower

Wiser, R., Porter, K. and Bolinger, M., Lawrence Berkeley National Laboratory. "Comparing State Portfolio Standards and System-Benefits Charges Under Restructuring," Memorandum (August 23, 2000) to various officials of the U.S. Department of Energy and the National Renewable Energy Laboratory, as well as, from contacts with State Energy Commissions and the Public Utility Commissions.

Information on wind capacity in place under construction in 1999 or planned for construction in 2000 was taken from:

The American Wind Energy Association's project database (as updated on July 7, 2000 ) on the website:
http://www.awea.org/projects/index.html

Various articles in Wind Power Monthly and Wind Energy Weekly.

Information regarding projects in the Wind Turbine Verification Program was obtained from the Department of Energy, Wind Energy Program, website: http://www.eren.doe.gov/wind/weu.html