Establishes a personal income tax credit for voltage regulation technology equipment.
TITLE OF BILL: An act to amend the tax law, in relation to establishing a personal income tax credit for voltage regulation technology equipment
PURPOSE: To encourage and establish incentives for the purchase and use of voltage regulation technologies.
SUMMARY OF PROVISIONS: Section 606 of the tax law is amended by adding a new subsection (g3) voltage regulation technology equipment credit. This subsection provides a tax credit equal to twenty-five percent of qualified voltage regulation technology expenditures, not to exceed five thousand dollars. Qualified voltage regulation technology equipment expenditures shall include expenditures for materials, labor costs properly allocable to on-site preparation, assembly and installation, engineering services, designs and plans directly related to the construction. The credit will be applied to the taxable year in which such equipment is placed in service.
JUSTIFICATION: The State of New York provides incentives to encourage the use of wind, solar and other renewable energies. Similar incentives for voltage regulation technologies could improve efficiency of the electrical grid and save consumers money. Currently it is theorized that up to (70%) of homes and businesses receive more voltage than they need, which results in wasted energy. This wastage is due to "line loss" through the transmission system, because utilities have to insure that the last customer on the line still receives the necessary amount of energy.
According to the U.S. Department of Energy, approximately (67%) of the energy in the form of electricity is wasted between the point where it is generated and enters the electrical grid, and the point where a consumer uses the electricity.
However, recent technological advances have made it possible to dynamically manage voltage at the point of consumption, substantially lowering energy consumption and improving power quality.
The amortization period to consumers for a residential owner could be 3-5 years without the tax credit. With the credit it could be 2-3 years, depending upon whether one lived in higher or lower energy cost section of New York.
LEGISLATIVE HISTORY: 2009-2010: S.4294/A.4276 - Referred to Investigations & Government Operations
FISCAL IMPLICATIONS: The cost for the installation for residential homes is anticipated to be around $800. The cost for commercial business are anticipated to range from approximately $800 to $15,000,
depending upon the size of the business. It is anticipated that residential owners will recoup the cost of the equipment within 3-5 years without tax credit. With such a credit, the return on investment for residence and business customers is expected to be shorter. Higher energy cost areas in New York will experience quicker returns on investments.
EFFECTIVE DATE: This act shall take effect immediately.
STATE OF NEW YORK ________________________________________________________________________ 1055 2011-2012 Regular Sessions IN SENATE (PREFILED) January 5, 2011 ___________Introduced by Sens. PARKER, SAMPSON -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Government Operations AN ACT to amend the tax law, in relation to establishing a personal income tax credit for voltage regulation technology equipment THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Section 606 of the tax law is amended by adding a new subsection (g-3) to read as follows: (G-3) VOLTAGE REGULATION TECHNOLOGY EQUIPMENT CREDIT. (1) GENERAL. A TAXPAYER SHALL BE ALLOWED A CREDIT AGAINST THE TAX IMPOSED BY THIS ARTI- CLE EQUAL TO TWENTY-FIVE PERCENT OF QUALIFIED VOLTAGE REGULATION TECH- NOLOGY EXPENDITURES. THIS CREDIT SHALL NOT EXCEED FIVE THOUSAND DOLLARS FOR QUALIFIED VOLTAGE REGULATION TECHNOLOGY EQUIPMENT. (2) QUALIFIED VOLTAGE REGULATION TECHNOLOGY EQUIPMENT EXPENDITURES. (A) VOLTAGE REGULATION TECHNOLOGY EQUIPMENT EXPENDITURES ARE THE COSTS ASSOCIATED WITH THE PURCHASE OF ON-SITE VOLTAGE REGULATION TECHNOLOGIES WHICH REDUCE ENERGY CONSUMPTION, IMPROVE GRID EFFICIENCY, RAISE OR LOWER VOLTAGE DYNAMICALLY AND ARE NINETY-NINE PERCENT OR MORE EFFICIENT ACROSS A MINIMUM OF NINETY PERCENT OF THE LOAD CURVE. (B) QUALIFIED VOLTAGE REGULATION TECHNOLOGY EQUIPMENT EXPENDITURES SHALL INCLUDE EXPENDITURES FOR MATERIALS, LABOR COSTS PROPERLY ALLOCABLE TO ON-SITE PREPARATION, ASSEMBLY AND INSTALLATION, ENGINEERING SERVICES, DESIGNS AND PLANS DIRECTLY RELATED TO THE CONSTRUCTION OR INSTALLATION AND UTILITY COMPLIANCE COSTS. (C) SUCH QUALIFIED EXPENDITURES SHALL NOT INCLUDE INTEREST OR OTHER FINANCE CHARGES. (3) MULTIPLE TAXPAYERS. WHERE VOLTAGE REGULATION TECHNOLOGY EQUIPMENT IS PURCHASED AND INSTALLED IN A PRINCIPAL RESIDENCE SHARED BY TWO OR MORE TAXPAYERS, THE AMOUNT OF THE CREDIT ALLOWABLE UNDER THIS SUBSECTIONEXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD02151-01-1 S. 1055 2
FOR EACH SUCH TAXPAYER SHALL BE PRORATED ACCORDING TO THE PERCENTAGE OF THE TOTAL EXPENDITURE FOR SUCH VOLTAGE REGULATION TECHNOLOGY EQUIPMENT CONTRIBUTED BY EACH TAXPAYER. (4) GRANTS. FOR PURPOSES OF DETERMINING THE AMOUNT OF THE EXPENDITURE INCURRED IN PURCHASING AND INSTALLING VOLTAGE REGULATION TECHNOLOGY EQUIPMENT, THE AMOUNT OF ANY FEDERAL, STATE OR LOCAL GRANT RECEIVED BY THE TAXPAYER, WHICH WAS USED FOR THE PURCHASE AND/OR INSTALLATION OF SUCH EQUIPMENT AND WHICH WAS NOT INCLUDED IN THE FEDERAL GROSS INCOME OF THE TAXPAYER, SHALL NOT BE INCLUDED IN THE AMOUNT OF SUCH EXPENDITURES. (5) WHEN CREDIT ALLOWED. THE CREDIT FOR VOLTAGE REGULATION TECHNOLOGY EQUIPMENT PROVIDED FOR IN THIS SUBSECTION SHALL BE ALLOWED WITH RESPECT TO THE TAXABLE YEAR IN WHICH SUCH EQUIPMENT IS PLACED IN SERVICE. (6) CARRYOVER OF CREDIT. IF THE AMOUNT OF THE CREDIT, AND CARRYOVERS OF SUCH CREDIT, ALLOWABLE UNDER THIS SUBSECTION FOR ANY TAXABLE YEAR SHALL EXCEED THE TAXPAYER'S TAX FOR SUCH YEAR, SUCH EXCESS AMOUNT MAY BE CARRIED OVER TO THE FIVE TAXABLE YEARS NEXT FOLLOWING THE TAXABLE YEAR WITH RESPECT TO WHICH THE CREDIT IS ALLOWED AND MAY BE DEDUCTED FROM THE TAXPAYER'S TAX FOR SUCH YEAR OR YEARS. S 2. This act shall take effect immediately.