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DATE: March 12, 2004

Contact Person: Commissioner Jim Burg
Contact Phone: 605-773-3201

SD Public Utilities Commissioner Burg Applauds Legislators' support of Omnibus Energy Bill

Public Utilities Commissioner Jim Burg recently complimented the South Dakota Legislature for voting unanimously to request South Dakota's Congressional Delegation to continue their support for the passage of the Omnibus Energy Bill.

The proposed Energy Bill mandates the use of ethanol and bio-based fuels, which South Dakota is expected to produce in quantities exceeding 340 million gallons, adding 350 million dollars to South Dakota's economy in 2004. According to House Concurrent Resolution 1014, by boosting ethanol production to five billion gallons a year, farm income could increase by more than one billion dollars a year and increased ethanol production could generate another one billion dollars or more a year in rural areas. The ten ethanol plants in South Dakota employ over 400 people and many of these plants are farmer-owned coops.

The current federal Energy Bill dictates an expansion of the ethanol industry from 2.5 billion gallons/year to five billion gallon/year nationwide.

The bill also reinstates the renewable production tax credit of 1.8 cents per kwh for new wind facilities. The wind incentives have been tested and proved to be effective, according to industry consultants. The Energy Bill provides both a rapid depreciation benefit and a ten-year Production Tax Credit of approximately $0.018/kwh produced for the first ten years of project life. This benefit has resulted in a rapid expansion of the wind industry.

"I believe the Legislature is recognizing an issue that could have one of the greatest positive impacts on South Dakota of any legislation before Congress," said Commissioner Jim Burg, who also chairs the National Association of Regulatory Utility Commissioners' (NARUC) Electricity Committee.

Also included in the proposed Energy Bill are provisions authorizing tradable tax credits for public power and other nonprofit organizations for electricity generated using renewable or clean coal facilities. The credits will promote the use of cleaner energy and mirror tax incentives for private power companies.

Commissioner Burg believes the proposed bill provides the basis for the development of a vibrant economic expansion for South Dakota based on renewable energy, i.e., ethanol, bio-diesel, hydro, wind and eventually hydrogen.

Individuals interested in reading the full text of House Concurrent Resolution 1014, can access it or any other legislation of interest at http://legis.sd.gov/sessions/2004/index.cfm

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