Biomass Feasibility Project Final Report - Xcel Energy

The Federal Renewable Energy Production Incentive (REPI)
The REPI program, which originated in the same Energy Policy Act of 1992 as the REPC outlined
above, differs in that it offers not tax deductions to for-profit companies but cash payments to
non-profit organizations which, having no profits, have no use for deductions. In 1993, the cash
payment was 1.5 cents/kWh, but it is indexed to increase with inflation. Since REPI is the nonprofit’s
alternative to the for-profit REPC, only new facilities owned by state and local
governments like municipal utilities, or by not-for-profit electric co-operatives that began
processing renewables between October 1, 1993, and September 30, 2003, are eligible. In 2005,
Minnesota utilities received a total of $316,847 from the program.
Like the REPC, the REPI program shows a preference for closed-loop biomass. It assigns
renewable projects to one or the other of two tiers. Tier One includes solar, wind, geothermal,
and closed-loop biomass projects. Tier Two includes open-loop biomass projects such as landfill
gas, digester gas, and agricultural and manufacturing wastes, and co-firing with other fuels. If
appropriations fall short of making 100% of payments to all projects, Tier One projects receive
their entire payments first; Tier Two projects divide what’s left.
General information on REPI is available at: http://www.dsireusa.org/library/includes/
incentive2.cfmIncentive_Code=US33F&State=federal&currentpageid=1&ee=1&re=1
While the private sector’s REPC tax deduction program is managed by the IRS, the U.S.
Department of Energy administers the non-profits’ REPI program. DOE’s web page REPI is:
http://www.eere.energy.gov/wip/repi.html
Two DOE information officers are assigned to respond to inquiries about the program. The one
to ask about policy issues and the availability of appropriations is: dan.beckley@hq.doe.gov
Implementation questions, like facility qualifications, applications and payments, go to:
christine.carter@go.doe.gov
For general federal information on renewable energy go to: http://www.eere.energy.gov
Minnesota Renewable Energy Production Incentive
As its title indicates, this program, dating from1997, mirrors the federal REPI program in offering
cash payments, in this case 1 to 1.5 cents/kWh, to certain types of renewable energy producers
over a ten year term. But it differs in that it offers those incentives not only to non-profits but also
to commercial companies, residences and tribal councils. It differs further in specifying a
narrower selection of eligible project types: wind, hydro and anaerobic digestion. The wind
program was closed to new applicants as of January, 2005.
The program was developed for small-scale projects: wind generators below 2 MW total, and
on-farm anaerobic digesters.
Further information is available at:
http://www.dsireusa.org/library/includes/incentive2.cfmIncentive_Code=MN06F&state=MN&C
urrentPageID=1&RE=1&EE=1
The Minnesota Department of Commerce website has a chart with useful thumbnail descriptions
of all federal and state renewable energy and energy efficiency incentives at:
Page 116
Identifying Effective Biomass Strategies:
Quantifying Minnesota’s Resources and Evaluating Future Opportunities