Writing for the Orlando Sentinel, Jason Garcia describes what he considered an “usual, late-night meeting” in which Speaker Will Weatherford engineered a tax break for a California company that had hired Southern Strategies to do its legislative bidding — yet digging in a little deeper on the nature and purpose of this tax break reveals nothing sketchy or uncommon, but instead reflects a move toward consistent tax policy in the promotion of cleaner energy.
The tax break, seen here as three short lines within Section 212.08, Florida Statutes, would exempt from sales tax the purchase of natural gas used to generate electricity in non-combustion fuel cells.
Seem unusual? Ill-placed? Not quite.
A read of this statute reveals a laundry list of related exemptions, all of which suggest the appropriate inclusion of fuels for non-combustion cells.
Currently exempt from sales tax: all fuels used by utilities in the generation of electric power or energy for sale; the transmission or wheeling of electricity; the purchase of equipment necessary in the production of electrical or steam energy resulting from the burning of boiler fuels; boiler fuels, when purchased for use as a combustible fuel; the purchases of natural gas, residual oil, recycled oil, waste oil, solid waste material, coal, sulfur, wood, wood residues or wood bark used in the manufacturing, compounding or production process; the sales of utilities to households, including oil, kerosene, liquefied petroleum gas, coal, wood, and other fuel products; and finally, materials used in the distribution of biodiesel, ethanol, and other renewable fuels up to $1 million in tax each state fiscal year.
In contrast to the above methods of energy production, non-combustion fuel cells are a nascent technology with a promising future in which energy could be generated with reduced emissions.
Bloom Energy, the California company who signed on with Southern Strategies, has a track record in developing these technologies and sells its cleaner energy to Wal-Mart, Google, AT&T and others already.
“We believe in developing alternative energy here in Florida,” said Weatherford as quoted in Garcia’s post. “These tax incentives will help our state remain competitive with other states in the development of fuel cell technology.”
Weatherford’s request to exempt fuels used for non-combustion cells serves to put this cleaner energy alternative on more even footing with other forms of energy production.
At an estimated cost to the state of just $100,000 per year, this seems like a gamble well worth taking.