Agenda Item 4A
May 16, 2017
May 12, 2017
Robert H. Drummer, Senior Legislative Attorney
Bill 9-17, Fuel-Energy Tax-Exemptions -Amendments
Government Operations and Fiscal Policy Committee-Transportation, Infrastructure,
Energy and Environment Committee recommendation (5-0):
enact the Bill with amendments.
Bill 9-17, Fuel-Energy Tax - Exemptions - Amendments, sponsored by Lead Sponsor
Councilmember Leventhal and Co-sponsors Council President Berliner, Councilmembers Elrich,
Rucker, Katz, Rice, Council Vice President Riemer, and Councilmember Navarro, was introduced
on April 4. A public hearing was held on April 25 and a joint Government Operations and Fiscal
Policy Committee/Transportation, Infrastructure, Energy and Environment Committee
worksession was held on May 4.
Bill 9-17 would exempt energy generated by a Community Solar Energy Generating
System (CSEGS) by exempting energy that is generated from a renewable source located
same electric service territory as the subscriber using the energy and subject to a virtual net energy
metering agreement (as defined in State law) with a public utility.
The County fuel-energy tax is imposed on every person transmitting, distributing,
manufacturing, producing, or supplying electricity in the County. For an electric company, the tax
is applied to the net consumption used to calculate each consumer bill and is passed through to end
users. Current law already exempts energy produced from a renewable source in the County and
either used on the site where it is generated or subject to a net energy metering agreement (as
defined in State law) with a public utility. However, this exemption only applies to the energy
produced from a renewable source, such as solar panels, located on the customer's property or
contiguous to the customer's property due to the definition in State law for "net energy metering"
generated by an "eligible customer-generator."
A CSEGS credits its generated electricity, or the value of its generated electricity, to the
bills of the subscribers to that system through a "virtual net energy metering" agreement, as defined
in State law. This type of facility can be located anywhere in the same electric service area, and
therefore, does not meet the eligibility requirements for the current fuel-energy tax exemption for
renewable energy. The County Attorney's Office has opined that the County fuel-energy tax