Governor Ernie Fletcher’s Communications Office
Governor Fletcher Releases Letters Supporting Urgent Need for Energy Legislation
FRANKFORT, Ky. – Governor Ernie Fletcher today released four letters from companies which support the urgent need for energy legislation. The letters discuss pending decisions by these companies on where to locate new alternative fuel facilities.
“Several companies are looking for the best state in which to build new alternative fuel facilities. For Kentucky to have a seat at the table when these decisions are made, it is imperative that the General Assembly address this issue immediately rather than wait for the 2008 session. This is a decision that cannot wait,” said Governor Fletcher.
One of those companies, Peabody Energy, is looking to build a large-scale coal conversion facility which will produce 100 to 200 million cubic feet per day of synthetic natural gas. The project will bring an investment of between $1.8 and $3 billion, 500 to 1,000 construction jobs and between 375 and 800 plant and mine jobs into the state chosen as home.
“This summer, Peabody Energy intends to make a major decision regarding development of this project and its location,” Peabody President Rick Bowen said in a letter to Governor Fletcher. “In doing so, Peabody must protect our shareholders by minimizing the cost of the project. Without the financial development incentives similar to those of neighboring states, Peabody would be unable to consider locating this initial project in Kentucky.”
Letters were also received from Rentech, Inc., TECO Coal Corporation and EnviRes LC.
“Rentech strongly believes a relationship with the Commonwealth would be mutually beneficial,” said Rentech, Inc. CEO and President D. Hunt Ramsbottom. “However, a potential relationship faces significant and unnecessary challenges if Kentucky cannot offer incentives comparable to those being offered in other states.”
“A clear knowledge of the scope of incentives offered by the Commonwealth is essential in our evaluation of the viability of coal to liquid projects in Kentucky. We plan to begin our evaluation process this summer,” said TECO Coal Corporation President Jim Shackleford.
“Several companies including EnviRes are poised to announce projects across the United States this year,” said EnviRes LC CFO William Renner. “It is imperative that we have a clear knowledge of the scope of the incentives that will be offered by the Commonwealth.”
In a letter to Governor Fletcher, Economic Development Cabinet Secretary John Hindman outlined the reasons these alternative fuels projects would not meet criteria required to receive Economic Development tax incentives.
“…Given the capital-intensive nature of the alternative fuels business model as conveyed to us by the Office of Energy Policy, and given the necessary restrictions in the existing laws, it is not practical to extend existing Economic Development incentive programs to alternative fuel facilities,” Secretary Hindman said in the letter. “Even if the language could be statutorily amended or expanded to accommodate these large fuel facilities, the expanded language would not be consistent with current economic development policy.”