North Dakota Enacts Renewable Energy Plan, Funds Key TBED Initiatives

A number of crucial TBED initiatives introduced earlier this year by North Dakota Gov. John Hoeven were recently enacted by the state legislature, including a $42 million renewable energy plan, $20 million in new funding for university-based Centers of Excellence, a 25 percent R&D tax credit, and additional investments in research and workforce development.

 

A comprehensive renewable energy plan aimed at supporting both state and national energy goals was created to help maximize use of the state’s renewable energy resources. The package also includes funding for programs that support the 25 x 25 Initiative, a nationwide goal that calls for 25 percent of the nation’s energy to come from renewable resources by the year 2025.

 

Funding for renewable energy investment programs and alternative energy development is central to the plan. This includes a new Biomass Energy Center to conduct research on biomass production and conversion; $5 million for the Biofuels PACE Fund, an interest buy-down program; and, $7.3 million for the governor’s Ethanol Production Incentive Fund, offering counter-cyclical support for ethanol plants.

 

The package also provides $7.9 million for alternative energy development programs, including $3 million in state funding to be leveraged with an additional $17 million from the U.S. Department of Energy for a Renewable Energy Fund. Additional components include:

• $13 million for investment tax credits, including tradable income tax credits and a 15 percent income tax credit for the installation of geothermal, solar, wind energy devices, and now including biomass equipment;
• $7 million for an agricultural research greenhouse complex at North Dakota State University;
• A property tax reduction for wind generation units from 3 percent to 1.5 percent of assessed value; and,
• Renewable energy promotions programs, including an energy policy commission to develop a comprehensive energy policy for the state.

In 2005, the legislature approved a similar package of incentives aimed at stimulating the growth of renewable energy, focusing on wind energy and biofuels. At that time, the Office of Renewable Energy at the North Dakota Commerce Department was created.

 

Last week, Gov. Hoeven signed HB 1018, providing $20 million for the Centers of Excellence Program within the 2007-09 Department of Commerce budget. According to the governor’s press office, the first installment of $20 million within the last biennial budget leveraged more than $70 million in additional funding for R&D in agriculture, renewable energy, advanced manufacturing and business technology. Following are additional key initiatives included in the Commerce budget.

• An R&D investment tax credit program offering up to 25 percent of expenditures;
• Increase of the Seed Capital Investment Tax Credit limit to $3.5 million per year and expansion of the Agricultural Business Investment Tax Credit;
• An increase in funding of $4 million in the North Dakota Development Fund to provide gap financing for business start-ups and expansions;
• State funding for Innovate North Dakota, a technology entrepreneurship program developed and produced by the University of North Dakota Center for Innovation to be matched dollar-for-dollar with privately raised funds; and,
• An increase of $8 million for workforce development initiatives, including career and technical education, internships, Workforce 2020 and cutting-edge job placement technology for Job Service North Dakota. 

More information on the 2007 Legislative Session is available at: http://www.legis.nd.gov/assembly/60-2007/leginfo/index.html