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| DEPARTMENT OF ENERGY ANNOUNCES NEW BUSINESS ENERGY TAX CREDIT PASS-THROUGH RATES | ||||||||
| 01/08/2010 | ||||||||
Salem- The Oregon Department of Energy has issued new administrative rules that govern the “pass-through” rate for the Business Energy Tax Credit (BETC). The “pass-through” option allows a project owner to transfer the BETC to a “pass-through” partner in exchange for capital to assist with costs of the project. The new rules offer a tiered rate depending on the type of project and project owner. Public entities, federally recognized Indian tribes and renewable energy resource equipment manufacturing facilities will receive a different rate than all other applicants. Public entities include cities, counties, state agencies, schools, community colleges and local service districts. The new rates are designed to provide more capital to project owners, ensure manufacturing and associated jobs continue to come to Oregon, and restore the original intent of the pass-through. The new pass-through rate is tied to the five-year U.S. Treasury Note and the urban Consumer Price Index for the Western region. This means the annualized rate of return for a pass-through partner taking a 5-year 50% renewable energy Business Energy Tax Credit will be 7.16% for a public, tribal or manufacturing project and 4.29% for all other projects. The previous rate was 9.85% for all projects. The new rules create a standardized pass-through formula and require a quarterly review process to ensure the rate reflects current economic conditions. The rate will be adjusted only if there is a quarterly change (up or down) in the Treasury bill rate of 1% or more. This is being done to ensure stability and predictability in the pass-through rate. All applications that receive a pre-certification from the Department after December 31, 2009 will be subject to the new rates The new rules are posted on our Web page for the rulemaking at http://oregon.gov/ENERGY/CONS/Rulemaking2009-BETC_PassThrough.shtml. |
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