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Trump administration ends two-year rent holiday for solar and wind projects

WION Web Team
WashingtonUpdated: May 18, 2020, 12:59 PM IST
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Photograph:(Reuters)

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This has also fallen into direct contrast with the government's promise of helping US companies through the economic turmoil through federal loans, waived fees, tax breaks and trimmed regulatory enforcement.

Amid these tough times of coronavirus, the Trump administration has decided to end the two-year rent holiday for solar and wind projects that are operating on federal lands.

The US government has handed these projects huge retroactive bills, which the corporations were not expecting. "The bills came as a surprise," Shannon Eddy, executive director of the Large-scale Solar Association, a trade group for owners of big solar farms, told a media house.

The decision has come as a huge shock, especially given the current scenario when a lot of industries have had to face the brunt of cancelled or delayed projects by the global health crisis, which has cut investment and dimmed the demand outlook for power.

This has also fallen into direct contrast with the government's promise of helping US companies through the economic turmoil through federal loans, waived fees, tax breaks and trimmed regulatory enforcement.

U.S. power plant owner Avangrid Inc, majority owned by Spain`s Iberdrola, received a bill for more than $3 million for two years of rent on its 131-megawatt Tule wind project on federal land near San Diego, according to spokesman Paul Copleman.

The decision of allowing corporations to have a two-year rent holiday was taken by the Trump administration in 2018, in order to review the situation after hearing complaints that the Obama administration had increased the rent too much, which is calculated based on acreage, as well as the amount of power and the type of technology being used to generate it. This increase made the companies uncompetitive with rents on private property.

The Interior Department's official website shows an expected collection of $50 million in rent fees for wind and solar projects in 2020, up from $1.1 million in 2019 and $21.6 million in 2018.

The Nuclear Regulatory Commission, meanwhile, recently agreed to a 90-day fee deferral for nuclear power plant owners due to economic disruptions caused by the pandemic.

(With inputs from Reuters)