What the dollar actually taxes

The levy is an excise tax, meaning a tax on an activity (here, generating wind power) rather than on property or income. It is set at one dollar per megawatt-hour under state law, and the Wyoming Department of Revenue collects it from the generator, not from you. Nothing about it touches a residential electric bill directly, which is why most ratepayers in Cheyenne or Rock Springs have never heard of it.

New turbines get a grace period. Under the statute as written, a wind facility owes nothing for its first three years of production, then begins paying the dollar per megawatt-hour after that. The idea, at last public explanation, was to let a project pay down some of its construction before the state and county started collecting. Whether three years is the right number is one of the things lawmakers keep revisiting.

Where the dollar lands

Most of the money stays local. At last public report, roughly 60 percent of the wind tax flows to the county where the turbines turn, with the balance going to the state's general fund. For a county like Carbon, where the Power Company of Wyoming's large Chokecherry and Sierra Madre project is under construction, that share can matter to a budget that already leans heavily on energy.

Counties tend to spend it the way they spend other mineral and energy money: roads, schools, emergency services, the ordinary machinery of a rural government. Because wind revenue rises and falls with how hard the wind actually blows and how many turbines are online, a careful commissioner treats it as money that can shrink, not a fixed line to build a payroll around. That caution is the honest part of the story the brochures skip.

The fight over raising it

That dollar has not changed since lawmakers created the tax around 2010, and nearly every session since has brought a proposal to raise it, often to three or five dollars per megawatt-hour. Supporters, usually hunting for new revenue in a state that depends on coal, oil, and gas severance money, argue wind should pay more as it grows. The bills have mostly failed.

Developers and some county officials push back, warning that a higher tax could steer projects and their transmission spending toward states with no such tax at all. Both sides have a point, and neither can prove its forecast, which is a large part of why the number sits where it does. If you want to watch the argument in the open, the Legislature's revenue committee between sessions is a better window than the floor during them.

Worth watching this month

1. The Wyoming Legislature's interim revenue committee is where any bill to raise the dollar per megawatt-hour would surface first, so its posted agendas are the earliest honest signal.

2. Carbon County's construction progress on the Chokecherry and Sierra Madre project matters, because more turbines online eventually means more taxable megawatt-hours once each phase clears the three-year grace period.

3. Rocky Mountain Power's integrated resource plan filings, which lay out how much new Wyoming wind the utility expects to build, hint at the tax base years ahead.

4. Progress on the TransWest Express transmission line is worth tracking, since a line built to carry Wyoming wind west changes how much gets generated here in the first place.

Questions readers ask

Does the wind tax show up on my electric bill?

No. It is charged to the company generating the wind power, not to ratepayers, so it does not appear as a line on a Rocky Mountain Power statement. Any effect on your bill would be indirect and hard to isolate.

Why does Wyoming tax wind when other states do not?

Wyoming leans on taxing energy production, such as coal, oil, and gas, to fund government, and the wind tax extends that habit to a newer resource. It remains the only state with a tax of this kind, at last public report.

How much does the tax actually raise?

Totals move year to year with wind output and the number of turbines past their three-year grace period, so any single figure goes stale fast. The state revenue department's annual reports are the place to find the current number.

Could the dollar go up?

It could. Bills to raise it to three or five dollars per megawatt-hour have come up in several sessions and mostly failed, but the idea returns whenever the state hunts for revenue.

Sources of record

  • Wyoming Department of Revenue (state agency)

    The agency that collects the wind generation tax; look here for excise tax rules and annual collection reports. revenue.wyo.gov

  • Wyoming Legislature, bills and statutes (state government)

    Search the wind energy production tax statute and track any session bill that would change the rate. www.wyoleg.gov

  • Western Electricity Coordinating Council, WECC (regional grid reliability body)

    The reliability organization for the Western Interconnect that Wyoming's grid belongs to; context on regional power flows. www.wecc.org

  • Rocky Mountain Power (utility)

    The state's largest utility; its resource plans show how much Wyoming wind it expects to add. www.rockymountainpower.net

  • Power Company of Wyoming, Chokecherry and Sierra Madre project (developer)

    Developer page for Carbon County's large wind project, with turbine counts and construction status. www.powercompanyofwyoming.com