Oklahoma will go at least another year without scaling back production tax credits for wind or adding new incentives to use natural gas.
The state faces a $1.3 billion budget shortfall in 2016.
The state legislature has been considering three bills to scale back an existing tax credit of 0.5¢ a kilowatt hour for generating electricity from wind and a separate bill to establish a 75% natural gas energy standard by 2020. The bills missed a March 10 procedural deadline to move to a third reading in the chamber of origin. They had cleared the committee stage. The current legislative session is expected to end around May 27. The bills are expected to be reproposed next year.
One of the wind bills would have cut off tax credits for new wind facilities placed in service after 2016. Another would have reduced the tax credit by 25% starting in July 2016. The third would deny any tax credits on wind electricity generated after 2017 unless the state legislature reauthorizes the tax credit after hearing from an evaluation body it set up to look at state tax incentives.
Wind accounts currently for 18% of electricity in Oklahoma. Other renewables account for another 2%. The state reduced its severance tax on oil and gas production last year to 2% from 7%. The reduced rate only applies to the first 36 months of production from new wells spudded in after the rate decrease.