Leading by Example
This week, the Oregon Department of Energy expanded eligibility for its biomass producer or collector tax credit to include standalone biomass power facilities. The move reminds me yet again of state renewable portfolio standard qualification revisions in Massachusetts that are now more than six months late.
The Massachusetts Department of Energy Resources expected to file the final qualifications regulation in July, but still hasn’t. The first draft seemed like a blatant and calculated attempt by multiple agencies and interest groups to wipe biomass power from the list of eligible facilities. One of the most damaging provisions in the draft was the stipulation that all facilities must meet an efficiency standard of 40 percent to receive even half of a renewable energy credit. Once efficiency reaches 60 percent, a full REC can be awarded. But most standalone biomass power plants achieve around 25 percent efficiency, so regardless of whether a combined-heat-and-power (CHP) element is explicitly required in the regulations, all biomass facilities that want to qualify for RECs would need to install a CHP component. And some will. We’ll have to see what the regulations look like when they’re finalized. I can only speculate as to why it has taken so long and whether the final version filed will be different from past drafts.
But Oregon, on the other hand, is much more organized. The state has not only expanded eligibility for the BPC credit, but it has extended the credit itself for two legislative cycles, through 2018. Recognizing its positive impact on the state, the biomass industry and the unemployment rate, legislators deemed it worthy of funding and continuance.
These states seem to be polar opposites when it comes to the biomass industry. While Massachusetts is on a path to exclude most biomass facilities from even qualifying as renewable, Oregon has invested in a state-wide tax credit to bolster the biomass industry it is building. And plenty of other U.S. states sit somewhere in the middle.
Oregon is setting a great example. Let’s all follow it.