BILL REQ. #:  H-1742.1 

Read first time 02/11/09.   Referred to Committee on Technology, Energy & Communications.

     AN ACT Relating to providing a credit under the public utility tax for sales and use taxes paid for the development of eligible renewable resources in the state that provide renewable energy to a qualifying utility; adding a new section to chapter 82.16 RCW; and providing an expiration date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION.  Sec. 1   A new section is added to chapter 82.16 RCW to read as follows:
      (1) A light and power business that is a qualifying utility is allowed a credit against taxes due under this chapter in an amount equal to one-quarter of the taxes paid by it or any other person under RCW 82.08.020 or 82.12.020 on machinery and equipment used directly in generating electricity from an eligible renewable resource that is used as the principal source of power, and sales of or charges made for labor and services rendered in respect to installing such machinery and equipment, in the calendar year in which the resource becomes operational and an amount equal to one-quarter of the taxes paid under RCW 82.08.020 or 82.12.020 in each successive year.
     (2) The credit under this section may not exceed the tax that was paid under RCW 82.08.020 and 82.12.020 on the machinery, equipment, labor, and services.
     (3) The credit under this subsection is available only if the renewable resource on which taxes were paid under RCW 82.08.020 and 82.12.020 is owned or operated by the qualifying utility or the electrical energy produced by the resource is contractually obligated to the qualifying utility at the time the credit is claimed under this subsection.
     (4) The following definitions apply to this section, unless the context clearly requires otherwise:
     (a) "Qualifying utility" has the same meaning as provided in RCW 19.285.030.
     (b) "Eligible renewable resource" has the same meaning as in RCW 19.285.030.
     (c) "Machinery and equipment" means industrial fixtures, devices, and support facilities that are integral and necessary to the generation of electricity from an eligible renewable resource.
     (d) "Machinery and equipment" does not include: (i) Hand-powered tools; (ii) property with a useful life of less than one year; (iii) repair parts required to restore machinery and equipment to normal working order; (iv) replacement parts that do not increase productivity, improve efficiency, or extend the useful life of machinery and equipment; (v) buildings; or (vi) building fixtures that are not integral and necessary to the generation of electricity that are permanently affixed to and become a physical part of a building.
     (e) Machinery and equipment is "used directly" in generating electricity from an eligible renewable resource if it provides any part of the process that captures the energy, converts that energy to electricity, or stores, transforms, or transmits that electricity for entry into or operation in parallel with electric transmission and distribution systems.
     (5) This section expires July 1, 2023.