Wind turbines near Hanna catch the light at sunset in November 2017. (Andrew Graham/WyoFile)

Proponents of a steeper wind tax in Wyoming intend to put the issue on the 2020 ballot after Speaker of the House Steve Harshman (R-Casper) refused to allow debate of bills raising the tax for the second year in a row.

The ballot initiative effort predates the legislative session, but Sen. Cale Case (R-Lander) said the refusal by Harshman and Senate President Drew Perkins (R-Casper) to allow debate emphasizes the need for the initiative.

“You can’t say the Legislature voted against it,” Case said. “They weren’t heard.” Case called the leadership’s blocking of the bills an “autocratic” move that stifled the democratic process.

“That’s not right and that’s not fair to the people of Wyoming,” Case said.

Speaking to reporters on Feb. 8, Harshman and Perkins both said the time was not right to impose taxes or restrictions on the wind industry. Harshman stifled three proposals to increase the wind tax, which like all tax increases have to begin in the House under the Wyoming Constitution.

Perkins held back a bill sponsored by Case that would block wind companies from exercising eminent domain over private landowners like other power utility companies have the power to do. Harshman held back a similar bill in the House. Harshman also held back bills to repeal the current wind tax, however.

The industry is just taking off in Wyoming, the two chamber leaders said, and it would be a bad time to scare developers.

“The thing that business and everybody wants is a little bit … you’ve got to have a little bit more of a certainty and consistency,” Harshman said.

Perkins described himself as “not a big fan” of wind energy. He said it is not as environmentally friendly as portrayed given the expanses of land wind farms occupy and the amount of concrete used to make the foundation for each turbine. Concrete production is a large emitter of carbon dioxide, a greenhouse gas and driver of climate change.

But, “regardless of how you feel about wind,” Perkins said, “those people have gone out, they’ve done their contracts … they’ve gone through their environmental impact statements and for the Legislature to come back at this time and just stay stop, that’s hard to do.” 

Sen. Cale Case (R-Lander)

Wind production in Wyoming is taxed at $1 per megawatt hour. Like other Wyoming energy industries, the wind industry pays steeper property taxes than residents. It also pays sales and use taxes.

The largest project in Wyoming is the Chokecherry and Sierra Madre Wind Energy Project proposed by Philip Anschutz’s Power Company of Wyoming. The company estimates that the project will pay $850 million in combined property, sales and Wyoming wind production taxes over the course of construction and 20 years of operations. The company estimates the 1,000 turbine wind farm will be completed by 2026.

Wind tax supporters say the time to implement a higher tax is now, so that companies have a fair sense of what the cost of doing business in Wyoming will be.

But tax proponents like Case, who detractors sometimes label ‘anti-wind,’  also believe the state is on the cusp of a wind farm explosion that could dramatically change the landscape. Companies are in a rush to install turbines before a tax credit begins winding down in 2021. Case wants to implement a steeper state tax before that happens.

“Our landscape is permanent,” Case said. “It’s fixed and it’s special and the fact that its fate is decided by a tax credit is kind of repulsive to me.”

Wind Wyoming’s Way

Case and others around the state have begun an initiative called Wind Wyoming’s Way. They hope to overcome the state’s high hurdles to ballot initiatives and put the question of an increased wind tax to Wyoming voters in 2020. Wind Wyoming’s Way seeks to raise the tax to $5 per megawatt hour. The initiative also seeks to remove a tax exemption for the first three years of production.

To succeed by 2020, organizers will have to secure 30,750 signatures, they wrote in a press release announcing the initiative’s start. Wyoming statute also calls for geographical diversity in the signatures — the initiative will need a significant number of signatures from two-thirds of Wyoming’s 23 counties.

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The organizers believe they’ll build a diverse coalition — from coal miners who think wind energy gets unfair advantages under federal policy, to conservationists worried about land use and public education advocates who want more money for schools.

Like Case, initiative organizer and former member of the House of Representatives Jeb Steward said the wind energy companies should pay a severance tax just like the mining industries, because of the permanent impact of the industrial activity.

“It seems we have undersold the value of the Wyoming I love with such a small tax for the permanent, massive industrialization of our open space with these wind factories,” Steward wrote in a press release.

“We look at a wind production tax as a severance tax to compensate Wyoming for something we will never get back.”

Case chairs Senate Revenue

This year, Case moved from running the Senate Corporations, Elections and Political Subdivisions Committee to chairing the Senate Revenue Committee, of which he was previously a member.

At a Joint Revenue Committee Hearing on Feb. 25, he suggested a wind tax should be one of the committee’s study topics for the months preceding the next legislative session. The committee will submit a list of suggested study topics to the Legislative Management Council, which ultimately sets each committee’s interim study agenda.

Andrew Graham

Andrew Graham is reporting for WyoFile from Laramie. He covers state government, energy and the economy. Reach him at 443-848-8756 or at andrew@wyofile.com, follow him @AndrewGraham88

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  1. Lots of specious logic, misinformation, and irrelevant information being used to confuse the issue in the comments here. I’ll try to give you all some cold hard facts.

    Fact: Any wind tax increases will NOT be felt by Wyomingites in any significant way. Currently, there are about 996 commercial wind turbines in the state of Wyoming. Approximately 85% of the power those turbines generate goes out-of-state. The new 1,000 turbine Chokecherry/Sierra Madre project that is currently being built in Carbon County will send fully 100% of the power it generates down and 730 mile power line to Las Vegas and from there to California. Another planned 800 wind turbine project, associated with Rocky Mountain Power, will send 85% or more of the power it generates out-of-state, too.

    Fact: The wind energy companies will NOT walk away if the wind tax is increased to $5 per megawatt hour. Of all the states on the Western power grid, Wyoming has the best wind, by far, and also has good power transmission capability. Other states to the east (like Nebraska) also have good wind but they are not connected to the Western power grid and it would be prohibitively expensive for them to do so. Additionally, many states are mandated by state law to buy a percentage of their electric power from renewable resources like Wind and Solar. California, in last year’s legislative session mandated that they must buy 60% of their electricity from renewable sources by 2030 and 100% from renewables by 2045. Considering there are only two really good places in California for land-based wind farms (San Gorgonio Pass just west of Palm Springs and Altamont Pass just outside of the Bay Area) and that both places have just about reached their maximum wind capacity, California MUST look elsewhere for Wind Power and Wyoming is the best place. Keep in mind California is the SIXTH largest economy in the entire world. That’s an energy market that will NEVER go away and the wind energy companies will be able to sell their electricity there even if the tax were above what Wind Wyoming’s Way is asking for.

    Fact: While there will be a decent number of construction jobs created to build these mega-wind farms, those jobs will only be temporary. Once those farms are built, those jobs will disappear. Will there be some maintenance jobs that will be permanently created? Yes, but it will be about 1 job per 100-130 turbines depending on the quality of the turbines and how technology is used to monitor them. So, maybe 20 or so permanent maintenance jobs will be created by these new 1,800 turbines from the Chokecherry/Sierra Madre and Rocky Mountain Power projects.

    Fact: These wind turbines will effectively be a PERMANENT part of our landscape as they will be around for probably 100-200 years. The land under those windmills will not be able to be used for any other economic purposes so all that acreage will be “locked up.” Not only will much of our vast landscapes be effectively ruined for other uses, so will our viewscapes. Californians won’t have to look at all those turbines but Wyomingites will.

    Fact: For each megawatt of electricity generated by gas-powered generators, about $5.00 in taxes are paid. For each megawatt our of electricity generated by coal-powered generators, about $3.00 in taxes are paid. For each megawatt of electricity generated by wind turbines, a $1.00 tax is paid. The fact that the wind energy industry pays so much less in taxes is effectively a state subsidy being given to the wind energy companies. It is not fair to our gas and coal-based electrical production companies that they have to pay so much more than the wind companies. The State of Wyoming is effectively playing favorites here and that is wrong. A $4.00 increase in the wind energy production tax will put these energy production companies on more even, competitive ground.

    Fact: Each wind turbine, in this part of the country, kills about 4 to 5 birds per year. Most are low-flying birds like raptors (eagles, hawks, owls, etc.). If the current and planned projects like the ones described above get fully built, we will have about 2,800 wind turbines in Wyoming that will kill 11,200 to 14,000 birds per year. Again, those are losses that California and other states do not have to suffer. Wyoming alone will suffer those.

    So, with Wyoming deriving almost none of the benefits and incurring pretty much all of the losses that come with these wind farms, I must ask why shouldn’t we Wyomingites be compensated adequately and equitably?

    The answer is we should. Please support the Wind Energy Production Tax Citizen’s Initiative.

  2. Mr. Hicks I believe you are confusing Mr. Stewards response. A republic is a state in which supreme power is held by the people and their elected representatives, and which has an elected or nominated president rather than a monarch. A democracy is a system of government by the whole population or all the eligible members of a state, typically through elected representatives. From both definitions there really doesn’t seem to be a great deal of difference other than at all levels of government it seems our elected officials take the notion of supreme power a bit to literal, I also believe Mr. Steward is merely pointing out that we as citizens of Wyoming have a right to be heard and our voices are just as important if not more important than those who make these decisions in Cheyenne at the State Capital. When are our elected officials going to start listening?

  3. In reference to Mr. Stewards post it is apparent that his statement of ” foundational principle of our Democracy” illustrates his lack of sagacity and limited understanding of our history and our government was set up. It’s no wonder he was such an abject failure as a legislator.

    The word democracy appears nowhere in the two most fundamental founding documents of our nation, the Declaration of Independence and the Constitution. Instead of a democracy, the Constitution’s Article IV, Section 4, declares “The United States shall guarantee to every State in this Union a Republican Form of Government, . . “. Our pledge of allegiance to the flag says not to “the democracy for which it stands” but to “the republic for which it stands.” Is the song that emerged during the War of 1861 “The Battle Hymn of the Democracy” or “The Battle Hymn of the Republic”?

    There is a story, often told, that upon exiting the Constitutional Convention Benjamin Franklin was approached by a group of citizens asking what sort of government the delegates had created. His answer was: “A republic, if you can keep it.”

    There is considerable evidence that demonstrates the disdain held by our founders for a democracy. James Madison, in Federalist Paper No. 10, said that a pure democracy, “there is nothing to check the inducement to sacrifice the weaker party or the obnoxious individual.”. At the 1787 Constitutional Convention, Edmund Randolph said, “. . . that in tracing these evils to their origin every man had found it in the turbulence and follies of democracy.” John Adams said, “Remember, democracy never lasts long. It soon wastes, exhausts, and murders itself. There was never a democracy yet that did not commit suicide.” Later on, Chief Justice John Marshall observed, “Between a balanced republic and a democracy, the difference is like that between order and chaos.” In a word or two, the founders knew that a democracy would lead to the same kind of tyranny the colonies suffered under King George III.

    Maybe Mr. Steward affinity for democracy is associated with his political party preference or maybe just a lack of education.

  4. Apparently, the Citizen Initiative has the attention of the Wind Industry and some supporters. It is truly unfortunate that some supporters equate this Wind Industry as meaningful economic development, which it is not.

    It would serve us well to understand just what the Citizen Initiative process tries to accomplish. This process is designed to give a voice to disenfranchised voters who strongly feel their voice is not being heard by their elected officials. It is for this reason I support the intention of the Initiative and I am happy to help. I think that every Wyoming citizen, (meaning not Colorado citizen), does support this process and will willingly give their support to let the people be heard.

    It would appear from previous comments there are some that do not trust this process. It would serve us well to remember those that do not support a foundational principle of our Democracy. We should not be afraid to let the people be heard.

  5. We the people of Wyoming have been ignored time and time again regarding all facets of wind energy development and associated taxation. Our leadership in Cheyenne continues to fail us. The Wind Wyoming”s Way Initiative will finally give the citizens of Wyoming a voice for our future. Join with us, for Wyoming!

  6. Readers may wish to review the detailed economic analysis done by the University of Wyoming Center for Energy Economics and Public Policy in 2016. The study summary is here: https://www.uwyo.edu/cee/_files/docs/201609_assessment-of-wyoming-summary.pdf or the full study is available here: https://www.uwyo.edu/cee/_files/docs/201609_wyoming-wind-competitiveness.pdf

    From page 5-6 of the summary and referenced elsewhere, the estimated Wyoming state tax burden on new wind power producers, including property taxes, sales/use taxes and electricity generation taxes over an assumed 20-year project life, equals $4.52/MWh.

    A $4/MWh electricity tax increase would almost double the entire current tax burden on new wind power projects. This would cripple a new industry that currently is poised to diversify and expand Wyoming’s economy.

  7. I implore anyone considering supporting a tax increase on Wyoming’s wind-generated electricity to first consider the studies conducted exclusively on wind energy development, taxation, and the renewable energy market and know all the facts. After years of closely considering all issues, we in Carbon County and other counties know that keeping taxes at the current level for wind plants is fair and gives us the best opportunity for securing new economic diversity and billions of dollars in new investment in Wyoming. Two studies conducted by the University of Wyoming support this. One study from 2016 showed that Wyoming “stands to lose significant economic activity and state revenue” worth more than what may be gained by increasing taxes on wind power, because of the risk that our wind electricity will be too expensive compared to renewable electricity available from other states, so then won’t be built. If the five studied wind projects can be built, the UW study projects $7.1 billion in new economic activity, $2 billion in new tax revenue for schools and governments, hundreds of jobs, and many other benefits delivered to Wyoming. Another UW study presented at our annual meeting in December 2018 shows Wyoming wind plants are already at a cost disadvantage when compared to other Western states, considering the current taxes paid by Wyoming wind in the form of property taxes, sales taxes, and electricity taxes, which other states do not impose. UW’s Dr. Robert Godby told another magazine, “Current wind contracts are estimated at $16/MWh-$20/MWh… Quintuple that (electricity) tax, though, and you’re going to “gobble up from 25 percent to over 30 percent of the potential gross revenues any developer could get.”

    Finally, Wyoming prides itself on being business friendly. Is doubling, tripling or quintupling any tax on any industry business friendly? Many legislators pledged no new taxes. Utilities have stated they are watching the wind tax proposals carefully and are fully aware that any of the proposals on the table would likely increase cost of electricity to their customers. Are you willing to tax yourself and increase your electric bill?

  8. Wyoming wind energy already pays its fair share in taxes—it contributes to property, sales and wind production tax revenues. This benefits multiple counties throughout Wyoming as well as overall state revenue, with contributions numbering in the millions of dollars every year. Although Wyoming has one of the country’s strongest wind resources, it’s surrounded by neighboring states like Colorado, South Dakota and Nebraska that also feature strong winds. That means in order to attract new projects—and the jobs and revenue they bring—Wyoming needs to maintain a tax environment that’s competitive with its neighbors. Wind developers want to harness Wyoming’s wind, and the best way to ensure that is to keep the state’s production tax at its current level. Raising it will only drive new projects across state lines while increasing the cost of electricity.

    -Tom Darin, Senior Director, Western State Affairs, American Wind Energy Association