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NV lawmakers seek renewable energy revenue-sharing law
by Cortney Maddock
May 17, 2009 | 2454 views | 0 0 comments | 8 8 recommendations | email to a friend | print
Tribune/Dan McGee - John Merola (left) and Louis Nez work on a production pump pipeline at ORMAT Technologies Galena operation in Reno. ORMAT is a geothermal energy company.
Tribune/Dan McGee - John Merola (left) and Louis Nez work on a production pump pipeline at ORMAT Technologies Galena operation in Reno. ORMAT is a geothermal energy company.
In a speech given at the Nevada Legislature in April, Sen. John Ensign, R-Nev., said he would propose renewable energy legislation that would help bring revenue back to the states and counties where the projects are built.

On Tuesday, Ensign, along with Sen. Harry Reid, D-Nev., and representatives Dean Heller, R-Nev., Dina Titus, D-Nev., and Shelley Berkley, D-Nev., introduced the Renewable Energy Permitting Act in Congress.

This act would affect future solar and wind energy projects in Nevada, Wyoming, Arizona and California.

Ensign’s press secretary, Sari Mann, said the new legislation would not apply to the Virginia Peak Wind Project north of Spanish Springs because it utilizes private land and the legislation only affects projects on federal land.

The Renewable Energy Permitting Act is modeled after the geothermal revenue-sharing program already implemented in Nevada, which allows the state, counties and federal government to receive a portion of the profits that the Bureau of Land Management receives from selling and leasing land.

“Nevada is positioned for a green energy boom, which means clean energy and quality jobs,” Ensign said in a press release. “Under this plan, it also means that states and localities will be compensated for federal land use. This would translate into millions of dollars for Nevada.

The Renewable Energy Permitting Act would distribute 50 percent of the land lease profits to the state, 25 percent to the county the land is leased in and 20 percent would go to the Renewable Energy Permitting Processing Improvement Fund, which would be allocated to the appropriate BLM office to fund future permits and applications.

According to the act, an additional 5 percent would go to the Solar Energy Land Reclamation, Restoration and Mitigation Fund. This fund would help with projects that might be abandoned or no longer in use on BLM land.

“The clean energy economy is so important to Nevada, where thousands of jobs will be created as projects begin to come online,” Reid said in a press release. “This legislation keep more money in the states and counties and takes responsible steps towards protecting open spaces where we’ll need to site some of these vital projects.”

For geothermal energy companies that use Nevada’s federal lands, the Energy Policy Act in 2005 established a fee for the projects. This act implemented a 50 percent profit distribution to the state, 25 percent to the county and 25 percent to the federal government.

According to Paul Thomsen at Ormat Technologies in Reno, the act also made federal land leases competitive, allowing companies to bid on specific parcels of land.

“(The Energy Policy Act of 2005) made it so we could bid for land, very similar to oil and gas companies,” Thomsen said. “In 2007, Ormat bid on 22 parcels in Nevada at cost of $8 million.”

Thomsen explained that Ormat’s bid is just to lease the parcels that the BLM sets aside for land leases. The company still has to pay to develop and build geothermal projects on the land.

“We currently own and operate nine power plants in the state of Nevada,” Thomsen said. “Four are in the process of development and construction.”

Thomsen added that after a geothermal power plant is built and functioning, the company then must pay a royalty to the BLM on the power it sells.

“For the first 10 years, we pay 1.75 percent from the profits of the electricity we sell,” Thomsen said. “Then, after the first 10 years, we pay 3.5 percent.”

In 2008, the BLM’s land leasing program was recording setting. According to the BLM Web site for Nevada, the federal agency offered 35 parcels of land for bid with more than 105,200 acres to be sold.

According to the reports on the BLM Web site, 10 companies bid on the 35 parcels making more than $28 million that would then be split between the state, various counties and the federal government.

The highest price paid for a parcel was $3.2 million by Standard Steam Trust, LLC from Denver, Colo. The highest price per acre was $1,000 for a 2,706-acre parcel that was purchased by Enel Geothermal, LLC of Reno.

From the 2008 BLM land leasing bids, Nevada earned $14 million and more than $7 million was distributed to Churchill, Elko, Esmeralda, Humboldt, Mineral, Nye and Pershing counties.

A Sparks company hopes a new solar panel will revolutionize ‘green’ energy

For the whole story, read Monday’s issue of the Sparks Tribune.
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