This past Saturday, Nevada Governor Jim Gibbons signed Assembly Bill 522 into law, extending and improving tax abatements for large-scale solar and other renewables. It was a major priority for our utility-scale campaign this spring, and we are happy to see the legislative session end with Nevada taking steps to tap its enormous solar potential.
With the market for large-scale solar heating up across the sunny southwest, tax incentives can tip the scale when it comes time to decide where to locate these new hubs of renewable energy generation. The tax abatements contained in AB 522 give Nevada a solid competitive advantage. That means critical savings for large-scale renewable energy projects and new economic opportunity for Nevadans.
For those who want to dive deep: The bill extends the sales and property tax abatements for wholesale renewable generators larger than 10 MW until June 30, 2049. Property tax abatements were increased from 50% to 55% and the duration of the abatements was extended from 10 years to 20 years. In recognition of the current fiscal situation facing the state, there was a slight decrease in the level of sales tax abatements (going from a 2% maximum tax rate to a 2.6% rate), although the abatement is now available for three years instead of two. Overall, this is an improvement in the level and duration of tax abatements offered for large-scale solar and renewable development.
Looking to ensure economic benefits pass through to Nevadans, the bill requires that developers taking advantage of the incentives make a minimum capital investment in the state, create a minimum number of jobs, establish a minimum average hourly wage, and requires a minimum level of benefits, including health insurance to be provided to workers. The abatements will be overseen by a new Energy Commissioner appointed by the Governor to head the newly created Renewable Energy and Energy Efficiency Authority.
In these tough times of strained state budgets, the Nevada legislature and Governor Gibbons are to be congratulated for their foresight in passing AB 522. As our own recent economic and environmental impact analysis showed, these tax abatements will help lead Nevada back on the path to prosperity while combating global warming – all in one fell swoop.