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WashingtonHB 19602025-2026 Regular SessionHouse

Encouraging renewable energy in Washington through tax policy and investment in local communities.

Sponsored By: Alex Ramel (Democratic)

Signed by Governor

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Bill Overview

Analyzed Economic Effects

9 provisions identified: 1 benefits, 1 costs, 7 mixed.

Tribes get clean energy capacity grants

Beginning January 1, 2028, Ecology runs an ongoing grant program every two years for federally recognized Washington tribes. Available money is divided equally among applicants, who are encouraged to include a supporting tribal resolution. Grants support clean-energy siting consultation, climate resilience and adaptation, tribal energy projects, grant applications, and related capacity work. The legislature intends to use climate investment funds in fiscal year 2028. Beginning in fiscal year 2029, it intends to increasingly use local investment funds, up to 25% of that account’s two-year appropriations. Receiving a grant does not take away a tribe’s right to object to or appeal qualifying projects.

Energy operators face new reporting duties

Beginning January 1, 2028, qualifying energy and battery operators must report to Revenue by March 15 each year. Reports identify tax-area location, generating and storage capacity, repowering, and other required information. Owners must report repowering to county assessors within 30 days and report rebuilds and refurbishments as they occur. Work completed before January 1, 2028, must be reported within 30 days after that date. Revenue can share covered taxpayers’ identities and tax information with local tax officials, including assessors and treasurers.

Energy developers must seek cultural input

Beginning January 1, 2028, counties seeking program funds must add tribal and archaeological engagement rules for qualifying energy projects. The rules cover projects applying for and completing county approval and filing an environmental checklist after that date. Developers must offer early engagement to tribes whose ceded lands and traditional use areas include the proposed site. They must also notify the state archaeology office and offer to meet. Site surveys must reflect input received from tribes and that office within 60 days of notice.

Local energy siting gets tighter limits

Beginning January 1, 2028, Commerce provides local governments with energy siting advice and ongoing support. By July 1, 2028, it must publish a model ordinance developed with developers, owners, host counties, tribes, and other stakeholders. The model covers wind-farm cleanup, financial guarantees, natural and cultural resources, and growth-management rules. Six months after publication, counties and cities seeking program funds cannot impose stricter or more burdensome siting rules. Adopting the model exempts counties from another state environmental review of the ordinance itself; project environmental mitigation does not automatically block funding eligibility.

Energy operators face replacement capacity taxes

Beginning January 1, 2028, Washington repeals its former renewable generation or storage tax and starts new capacity-based taxes. Annual state rates are $968 per megawatt for solar, $1,200 per megawatt for wind, and $156 per megawatt-hour for batteries. Operators pay the state monthly. Counties can add annual taxes of $2,905 per megawatt for solar, $3,600 per megawatt for wind, and $467 per megawatt-hour for batteries. County payments are due April 30 and October 31. These taxes cover qualifying systems opening from January 1, 2028, and older systems entering through repowering or transition rules. Rates last for the facility's life or until repowering, and these taxes are additional to other state and local taxes. County receipts go to local taxing districts based on prior-year property tax rates, excluding specified voter-approved excess levies authorized after January 1, 2028. A state review is due October 31, 2031; it cannot recommend changing rates for facilities already paying them. Legislative rate changes require at least three years' notice and cannot take effect before January 1, 2034.

Extra energy taxes support local levies

Beginning January 1, 2031, counties can add a special energy tax for qualifying voter-approved local or school levies. Operators pay the local energy tax rate multiplied by the levy’s share of combined local levy dollars. That share is capped at 5% for one levy and 10% total for multiple levies. A levy absent from the county levy for the prior 10 years can count in full; replacements count only increases. The money goes to the districts imposing the levies, follows ordering rules when several levies qualify, and is paid with the county energy tax. The added tax ends when its matching levy ends.

Local property tax limits change

For taxes collected in 2028 and later, local levy limits allow added dollars from specified property-value increases. These include new construction, biomass and geothermal power facilities, improvements, state-assessed property, and designated tax-increment areas. Wind and solar no longer receive the facility-specific treatment, and the same property cannot be counted twice. District mergers and annexations must account for these categories; exclusions apply to state, port, and public utility district debt-service levies. Local governments must hold a public hearing on next year’s budget revenue before setting levies. Property tax revenue increases require a separate ordinance or resolution stating dollar and percentage changes for up to two years, apart from the listed exceptions.

New energy revenues reach host communities

Beginning January 1, 2028, the law ends the former local benefit account and creates a new local investment account. All state energy tax receipts enter the new account. Starting in fiscal year 2029, at least 75% of its appropriations each two-year budget must support Commerce’s local distribution program. Counties receive available funds based on their share of state energy taxes from the prior reporting period. Eligibility requires a local project operating before January 1, 2029, a completed environmental-review application as of November 2025, or adoption or substantial adoption of the state’s model siting ordinance. Projects also need permits through the state energy siting, coordinated clean-energy, or city or county permit process. Counties generally share funds with local taxing districts based on property tax levy shares; rural counties can keep their full allocation. Commerce sets spending rules and can charge reasonable administrative fees, which return to the account. Remaining appropriations go first toward tribal grants, up to 25%, and then to the general fund.

New property tax breaks for energy owners

Beginning January 1, 2028, eligible wind, solar, and battery equipment gets a new property tax exemption, replacing the former exemption. The new exemption applies to taxes collected in 2029 and later. Wind and solar facilities need at least 10 megawatts of alternating-current capacity; batteries need at least 10 megawatts of storage capacity. Hydroelectric storage and storage covered by the specified payments-instead-of-taxes law are excluded. New or repowered systems qualify; repowering means a major rebuild that materially increases capacity, not routine maintenance. Older systems can enter the new energy tax system after 25 years; taxes and the exemption apply automatically after 35 years since opening or the last repowering. Certain projects opening or repowering after July 1, 2026, but before January 1, 2028, need notice by September 1, 2026, and county tax authorization before March 1, 2028. Projects with completed environmental-review applications as of November 2025 that open after July 1, 2026, but before December 31, 2034, can give notice to Revenue and the assessor by April 30; taxes and the exemption start the following January 1. Counties must adjust property tax rates to prevent unintended effective tax increases caused by the exemption.

Sponsors & Cosponsors

Sponsor

  • Alex Ramel

    Democratic • House

Cosponsors

  • April Berg

    Democratic • House

  • Beth Doglio

    Democratic • House

  • Joe Fitzgibbon

    Democratic • House

  • Julia Reed

    Democratic • House

  • Lisa Parshley

    Democratic • House

  • Natasha Hill

    Democratic • House

  • Shaun Scott

    Democratic • House

Roll Call Votes

All Roll Calls

Yes: 202 • No: 30

House vote • 3/11/2026

Final Passage as Amended by the Senate

Yes: 86 • No: 9 • Other: 3

Senate vote • 3/5/2026

3rd Reading & Final Passage as Amended by the Senate

Yes: 42 • No: 6 • Other: 1

House vote • 2/23/2026

3rd Reading & Final Passage

Yes: 74 • No: 15 • Other: 9

Actions Timeline

  1. Effective date 1/1/2028.

    4/1/2026House

  2. Chapter 260, 2026 Laws.

    4/1/2026House

  3. Governor signed.

    4/1/2026legislature

  4. Delivered to Governor.

    3/12/2026legislature

  5. Passed final passage; yeas, 86; nays, 9; absent, 0; excused, 3.

    3/11/2026House

  6. House concurred in Senate amendments.

    3/11/2026House

  7. Speaker signed.

    3/11/2026legislature

  8. President signed.

    3/11/2026legislature

  9. Rules suspended. Placed on Third Reading.

    3/5/2026House

  10. Committee amendment(s) adopted as amended.

    3/5/2026House

  11. Third reading, passed; yeas, 42; nays, 6; absent, 0; excused, 1.

    3/5/2026House

  12. Placed on second reading by Rules Committee.

    3/3/2026House

  13. Passed to Rules Committee for second reading.

    3/2/2026House

  14. Minority; without recommendation.

    3/2/2026House

  15. Minority; do not pass.

    3/2/2026House

  16. WM - Majority; do pass with amendment(s).

    3/2/2026House

  17. First reading, referred to Ways & Means.

    2/24/2026House

  18. Third reading, passed; yeas, 74; nays, 15; absent, 0; excused, 9.

    2/23/2026House

  19. Rules suspended. Placed on Third Reading.

    2/23/2026House

  20. Floor amendment(s) adopted.

    2/23/2026House

  21. 3rd substitute bill substituted.

    2/23/2026House

  22. Rules Committee relieved of further consideration. Placed on second reading.

    2/17/2026House

  23. APP - Executive action taken by committee.

    2/9/2026House

  24. Minority; without recommendation.

    2/9/2026House

  25. Minority; do not pass.

    2/9/2026House

Bill Text

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