Oregon Governor Might Veto Energy-related Bills

Governor Ted Kulongoski may veto bills he worries could slow Oregon's efforts to boost the green economy and reduce global warming.

One of the measures would trim a program that subsidizes green energy projects by reducing tax credits for large wind farms. The other would allow older biomass plants to be counted toward the state's renewable energy standards adopted two years ago.

Kulongoski spokeswoman Anna Richter Taylor said the governor has not decided on either bill, "but he doesn't want to see legislation that would slow down momentum in this area."

In the session's final days, lawmakers decided to lower the maximum state tax credits for large wind projects from $10 million to $3.5 million. Environmental groups objected, saying this isn't the time to roll back Oregon's incentives for alternative energy.

Legislative sponsors said that with the recession squeezing the state's finances, wind energy became a target for a reduction because the industry has become competitive without the need for subsidies.

Kulongoski opposed the reduction, but he might sign the measure anyway because it also contains incentives for electric car manufacturers, which he wants to attract to Oregon.

The biomass measure would allow electricity generated from a facility using biomass that became operational before 1995 to comply with Oregon's renewable portfolio standard. Biomass plants generally burn wood waste from sawmills or logging operations.

The bill passed despite criticism from environmental advocates who said it would allow utilities to get around part of the state's renewable power mandates.

Approved by the 2007 Legislature, Oregon's renewable-energy standard requires utilities to meet 25 percent of their retail demand by 2025 with electricity from renewable-energy projects such as wind, solar, geothermal, or biomass.

The 2007 law counts only resources that came online after January 1995. But the bill that recently gained approval would allow utilities to buy power from biomass projects that were in operation before the 1995 cutoff date and count it toward the renewable power mandates.

Forest industry officials sought the change to make the pre-1995 plants more competitive with newer projects.