United States

United States

Minnesota incentive program a victim of its own success

A production incentive for small utility-scale wind projects in Minnesota has expired due to its own popularity. The state sponsored incentive for projects sized 2 MW or less is designed to encourage turbine installations on Minnesota farms, but whether the state legislature will extend the incentive is still unknown, says Jeremy Defiebre of the state's Department of Commerce. He says legislation for that extension was recently introduced in the state House, but it could be some time before the bill's fate is decided. The program offers $0.015/kWh which, combined with the federal production tax credit (PTC) for business with a tax liability or the renewable energy production incentive (REPI) for non-profits that do not pay taxes, helps reduce the price of wind energy in Minnesota by more than $0.03/kWh. The program's initial subscription ceiling of 100 MW was extended to 200 MW a year ago, but that ran out at the end of 2003. There is currently more than 50 MW of wind capacity sitting in a queue waiting for the state's legislature to add another 100 MW extension. Of the 200 MW that have applied for the incentive, 131.7 MW are already built. The remaining must be built within 18 months of their application to the Minnesota Department of Commerce. "We were surprised at how fast the second 100 MW was taken," Defiebre says.

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