Whitesburg KY

Lawmakers gather to debate energy bill


Lawmakers returned to the state Capitol this week for what they hope will be a quick special session as they begin debate on an energy bill that is intended to lure a $3 billion coal gasification plant to Kentucky.

The measure appears to be on the fast track to passage with legislative leaders predicting that it will clear the General Assembly by week’s end.

“It will pass very comfortably,” said House Speaker Jody Richards, D-Bowling Green. “In my judgment, there won’t be many votes against it.”

The measure had been caught up in an election-year political squabble that nearly doomed it until House and Senate leaders hammered out a tentative agreement after weeks of closed-door negotiations.

The dollar value of a proposed incentives package intended to land the Peabody Energy coal gasification plant would be substantial, but lawmakers say they are not certain of the actual amount.

Legislative leaders have agreed to provide financial incentives for all qualifying companies that build alternative fuel facilities. Early estimates put the value of the proposed Peabody incentives at $300 million.

Under the legislation, actual incentives would be decided by the Kentucky Economic Development Finance Authority, not the General Assembly.

The proposal would provide breaks on sales taxes, income taxes and coal severance taxes for alternative fuel plants.

The environmental group Kentuckians for the Commonwealth is lobbying against the bill and has even purchased newspaper ads criticizing the proposal. Teri Blanton, a member of the group, said she fears it could lead to the leveling of even more mountaintops by coal companies taking advantage of the incentives.

“It’s not that we need to lure them here,” Blanton said. “The coal is already here.”

Blanton plans to testify against the measure on Tuesday during a meeting of the House Appropriations and Revenue Committee.

In addition to Peabody, Houston-based Future Fuels LLC has also expressed an interest in building in Kentucky. The company is working with Kentucky River Properties LLC to develop two “clean coal” projects near Hazard, Ky.

Gov. Ernie Fletcher had included the issue on an agenda with several other items when he called the General Assembly into a special session last month. House lawmakers refused to take part, saying many of the items could wait until they convene in January.

In an order Friday, Fletcher limited the agenda to only the energy bill, calling on lawmakers to make any necessary financial appropriations to get the measures implemented. He said the measure would decrease the state and nation’s dependence on foreign oil and create more markets for Kentucky coal.

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