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Florida’s Progress Energy Seeks Tax Increase – Could Save Energy; Worth the Money?

| Thursday September 24th, 2009 | 0 Comments

tax

According to a report by the St. Petersburg Times, Florida utility Progress Energy is seeking to increase the base utility tax rate by about 30 percent. It says increasing the tax could save energy and boost local governments’ tax collections next year (for governments that charge utility and franchise taxes). Would taking this measure have enough benefit for the state’s sustainable growth to be worth taxpayers’ money?

Progress Energy already offers rebates of 33 to 50 percent of the cost of energy efficiency-promoting upgrades. If the utility uses the revenues from the tax increase to create an additional set of rebates, this could make some of the less expensive upgrades close to free (for example, window film and energy-efficient lighting). Such tax increases could therefore reduce electricity usage by homes and businesses and make it feasible for renters to purchase upgrades.

Proponents of the tax increase argue that the rebate plan has advantages over offering refunds to participating consumers. According to the report, the rebate system would boost the inventorying of the city’s energy-efficient buildings, reduce electricity usage, and create retrofitting jobs more than a refund system would.

Progress Utility must obtain approval from the tax increase from St. Petersburg’s Public Service Commission. If approved, the tax increases would not be implemented until January. If the utility obtains approval for half its request, the city would expectedly gain an additional $3 million by September 2010.


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