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Oregon Governor Tina Kotek has ordered state agencies to expedite solar and wind permits which must break ground by 2026 to potentially benefit from a federal tax credit set to end. The move comes amid reporting on Oregon’s slow growth rates for green energy, largely due to a lengthy permitting process. However, green energy advocates are skeptical about the order’s impact, pointing out that it doesn’t address the federal government’s slow pace in increasing transmission capacity for new wind and solar power.
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Oregon Governor Fast-Tracks Renewable Energy Permits to Secure Federal Tax Credits
In an attempt to avoid missing out on federal tax credits set to expire, Oregon Governor Tina Kotek has issued an executive order expediting the permit process for solar and wind projects. The projects must commence construction by 2026 to be eligible for the tax credits, which are being phased out by Congress.
This initiative came in response to reports from Oregon Public Broadcasting and ProPublica highlighting the slow growth of green energy in Oregon, partly due to the state’s lengthy permitting process. Governor Kotek’s order has been seen as an effort to ensure that “shovel-ready” projects are not at risk of missing out on federal tax benefits, which make them more affordable.
The Governor expressed urgency in her statement, “With the elimination of promised incentives by the Trump Administration, states must step up as the last line of defense against climate catastrophe. We have to get renewable energy infrastructure built, and quickly,” Kotek said. “We cannot afford to lose this critical window.”
Despite the order, concerns remain about other barriers to building renewable energy infrastructure, including the federal government’s slow pace of adding transmission capacity to handle new wind and solar sources. Oregon’s energy concerns are expected to persist far beyond the 2026 deadline, and long-term solutions are needed for the permitting and transmission process.
The tax credits in question were modified and extended during the administration of President Joe Biden as part of the Inflation Reduction Act but are now scheduled for termination due to legislation signed by President Donald Trump. Projects are still eligible for the credits if they start construction by July 4, 2026, and are completed by 2030. However, those not starting construction by the deadline must be operational by December 31, 2027, to qualify.
Analysts predict that the loss of these credits could cost Oregon about 4 gigawatts of planned wind and solar energy. According to data from Atlas Public Policy, this is enough electricity to power approximately 1 million homes, with 11 wind and solar projects in Oregon at risk of not qualifying for the tax credit.
Despite Governor Kotek’s order, some in the renewable energy sector are skeptical. Nicole Hughes, executive director of Renewable Northwest, expressed concerns about the state’s ability to complete all or even a few of the projects in time to receive the tax credits. She cited transmission queue backlogs and delayed transmission upgrades as significant roadblocks for projects that have already made it through the permitting process.
To connect to the federal Bonneville Power Administration’s transmission lines, energy developers must wait for approval. Without additional capacity for new sources of electricity, these lines are almost at full capacity, and determining whether a proposed project can connect to the grid can take years.
In response to these concerns, a spokesperson from Bonneville stated that they have modified the interconnection process to work on a “first-ready, first-served” basis, expected to improve the current backlogs. They also expect to add approximately 2 gigawatts of new energy projects by the end of 2028.
As part of her executive order, Governor Kotek instructed the Oregon Department of Energy and the state Energy Facility Siting Council to prioritize approval for projects needing to start construction by July 4. Priority will be given to projects with secured contracts between a developer and a utility that can show anticipated benefits to Oregon ratepayers.
The order also suggests that the Oregon Public Utility Commission consider hiring an outside contractor to study how future wind and solar power projects connect to the electrical grid.
Climate Solutions Oregon Director, Nora Apter, praised the governor’s swift action to get as many wind and solar projects across the finish line before the loss of federal tax credits, asserting that Governor Kotek is defending Oregon families, jobs, and energy resilience.
Oregon is following in the footsteps of other states, including Colorado, Maine, and California, who have also fast-tracked approval of qualifying projects due to the federal tax credits’ expiration.
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