Clean energy companies could get tax credits for coming to Southside Virginia megasite

Clean energy companies could get tax credits for coming to Southside Virginia megasite

Companies making clean energy products could get federal tax credits for bringing an industry to the Southern Virginia Mega Site at Berry Hill.

The 3,500-acre mega park in southwestern Pittsylvania County sits in a census tract adjacent to another area in Rockingham County, North Carolina, that has experienced job losses in a fossil-fuel-related industry.

That makes the area where Berry Hill is located an energy community.

“The Berry Hill megasite falls into one of those geographic areas,” said Janine Kritschgau, spokesperson for U.S. Sen. Tim Kaine, D-Va. “Therefore, should a company decide to use the site for clean-energy production or the manufacturing of products needed for clean-energy production, then that company would be eligible for the additional incentives.”

Those incentives, under the federal Inflation Reduction Act, would be available for energy communities. The act defines energy communities as:

  • those deemed a brownfield site by the Environmental Protection Agency, meaning it has the presence or potential presence of a hazardous substance, pollutant or contaminant;
  • those that have a significant portion of local employment or local tax revenues derived from a traditional energy industry and an unemployment rate above the national average; or
  • a census tract (or directly adjoining census tract) in which a coal mine closed after 1999, or in which a coal-fired electric generating unit has been retired after 2009.

The mega site is located in a census tract adjacent to a census tract in Rockingham County, North Carolina, where Duke Energy’s Dan River Steam Station closed.

The Dan River Steam Station went online in 1949 and was closed in 2012, when it was replaced by a natural gas facility.

The steam station is the site of a Feb. 2, 2014, coal ash spill that dumped 39,000 tons of coal ash into the Dan River. The incident occurred when a drainpipe failed, coating the river bottom with toxic sludge for about 75 miles.

Coal ash is the waste left after burning coal. It contains arsenic, mercury, lead, and over a dozen other heavy metals, many of them toxic.

An industry that brings a clean-energy manufacturing facility could get a 10% tax credit.

“If a company locates in an energy community, they can be eligible for some of the $4 billion set aside for competitively selected clean-energy manufacturing tax credits, or the 10% bonus for clean electricity,” Kritschgau said.

As for other incentives, the amount of the credit would be based on which tax credit the company would choose for its project, Kritschgau said.

Pittsylvania County Economic Development Director Matt Rowe said the tax credits are generating interest in the site from companies and add to the site’s marketability for industries.

“The more tools you have in the toolbox, the better it is for you,” Rowe said of the credits’ potential for attracting projects.

Danville City Manager Ken Larking agreed.

“Having that incentive would enhance our ability to attract the kinds of prospects we believe would be a good for our community,” Larking said.

The megasite is jointly owned by Danville and Pittsylvania County through the Danville-Pittsylvania Regional Industrial Facility Authority.

Local officials hope to attract a major manufacturer to the site that would bring thousands of jobs. Projects have come close, but the companies chose to locate to other areas.

Charlotte, North Carolina-based Albemarle Corp. considered the 3,500-acre site in southwestern Pittsylvania County for locating a lithium hydroxide processing facility, but chose to take its project to Chester County, South Carolina, instead.

Albemarle plans to invest at least $1.3 billion and create more than 300 new jobs with average annual pay at about $93,000 at a nearly 800-acre parcel of land in South Carolina, according to a March 22 news release on Albemarle Corp.’s website.

Late last year, a $3.5 billion Ford electric-battery manufacturing project, which would have brought about 2,500 jobs to the region, was shut out of contention in Virginia by Gov. Glenn Youngkin.

Ford ended up deciding to build its plant in Michigan after Youngkin removed Virginia from consideration for the project due to the project’s partnership with a Chinese company.

The Berry Hill megasite nearly landed a $5.5 billion Hyundai plant last spring that would have brought 8,500 jobs to the region. The plant opted to locate in Georgia, where it was called the largest economic development plan in Georgia history.

As for the tax credits for clean energy, Jason El Koubi, president and CEO of the Virginia Economic Development Partnership, said, “The Southern Virginia Megasite at Berry Hill is a highly marketable property and would certainly be competitive for a clean energy project that would qualify for the tax credit.”

Created in 1995, the partnership collaborates with local, regional and state partners to encourage the expansion and diversification of Virginia’s economy, according to its website.

Source: Danville Register & Bee | Author: John Crane
Title: Clean energy companies could get tax credits for coming to Southside Virginia megasite
Date: April 21, 2021

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