House OKs tax breaks for some electric stations

House OKs tax breaks for some electric stations

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North Dakota's House approved tax breaks for some aging electric power stations, natural gas processing plants and an oil refinery, which the factories may use if they undertake costly upgrades to reduce air pollution.

The incentives are included in two bills, which the House endorsed Thursday. They now go to the state Senate for its review.

One measure gives tax breaks to older electric stations that make large investments in environmental improvements, or refit to change how they produce electricity.

The minimum investment depends on the size of the power plant being improved. For Montana-Dakota Utilities Co.'s Heskett station, north of Mandan, the minimum could be $2.5 million. Larger plants, including Basin Electric Power Cooperative's Leland Olds station, would need to spend at least $21 million.

A power plant refitting project could include changing its inner workings to manufacture synthetic gas from lignite, and then using the gas to generate electricity.

Coal plant upgrades would qualify for a sales tax exemption on the needed equipment, and a five-year exemption from the state's coal conversion tax, which is calculated using the plant's electric production and its capacity to produce power.

The second bill would give a sales tax break to the Tesoro oil refinery near Mandan, and natural gas processing plants in Alexander, Killdeer, Lignite and Tioga in western North Dakota.

The coal bill is HB1268. The oil and gas bill is HB1498.

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