As part of our incentive and location consulting services, Atlas Insight often assists our clients in realizing savings associated with energy use at their manufacturing and industrial facilities. A few examples of potential opportunities include:
Economic Development Utility Rate Riders
Many utility companies throughout the U.S. offer Economic Development rate riders to help spur job growth in their service territory. Often these incentives are targeted toward companies and facilities which are increasing their load as a result of an expansion project. While the potential savings will vary depending on the utility, Atlas Insight routinely works with companies to identify and negotiate these Economic Development rate riders which can result in savings of as much as 50% of your incremental usage for up to 10 years. If your company is considering a project which will significantly increase your energy requirements, then these incentives can have a real impact on your bottom line. Note that in some cases utility companies can also offer rate reduction for retention loads.
State Utility Sales Tax Exemptions
Many states allow for an exemption for fuel and energy used by manufacturing facilities. This may include utility provided electricity and gas as well as, oil, propane and other fuel purchased for use at the facility. Each state has its own requirements on what may qualify for a sales tax exemption. In some instances only energy and fuel used directly in the production process can qualify, and in other cases an exemption may be claimed on 100% of use at the manufacturing facility. Regardless of your situation, Atlas Insight can assist your company in determining your qualifying percentage, help obtain a sales tax refund on past purchases, and ensure that your facilities are receiving exemptions on an ongoing basis.
Federal Fuel Tax Credits & Exemptions
Another potential source of energy related savings is via Federal Alternative Fuel Tax Credits and Exemptions. There are a number of exemptions available for fuel purchased and used in a non-taxable manor as well as credits for the purchase of alternative fuels. For example, a commonly overlooked incentive is the $0.50/gallon tax credit for propane. Propane is often used to power forklifts. For a large industrial company this credit can result in significant annual savings. While it is unclear whether this particular credit will be retroactively extended beyond 12/31/13, Atlas Insight can still assist your firm in obtaining a refund on this credit as well as for others allowed under statute.