SB218 • 2026

TAX: ELECTRIC COOPS/GENERATION/STORAGE

An Act relating to the taxation of electric cooperatives; relating to the taxation of electricity generation and electricity storage facilities; and providing for an effective date.

Taxes

Passed Legislature

This bill passed both chambers and reached final enrollment, even if later executive action is not shown here.

Sponsor: SENATE RULES BY REQUEST OF THE GOVERNOR
Last action: 2026-02-18
Official status: (S) L&C
Effective date: Not listed

Plain English Breakdown

The official text states the law takes effect on July 1, 2026 (Section 6), but does not specify if this date applies to all sections or only future provisions.

Tax Changes for Electric Co-ops and Power Facilities

This law removes state taxes on electric cooperatives and gives tax breaks to new electricity generation or storage facilities built after July 1, 2024.

What This Bill Does

Removes state ad valorem, income, and excise taxes for all electric cooperatives.
Stops the refund of telephone cooperative gross revenue taxes that were previously shared with local governments when they involved electricity sales.
Confirms that agencies under AS 42.45.310 are exempt from most state and local taxes on their property, income, and bonds.
Exempts new electricity generation or storage facilities built after July 1, 2024, from state ad valorem, income, and excise taxes if they meet specific ownership rules.
Repeals three existing sections of the Alaska Statutes related to electric cooperative taxation.

Who It Names or Affects

Electric cooperatives operating in Alaska
Agencies established under AS 42.45.310 that sell electricity at retail
Entities building new electricity generation or storage facilities after July 1, 2024
Local governments and cities that previously received tax refunds from electric cooperative sales

Terms To Know

Ad valorem tax: A property tax based on the value of land or buildings.
Electric cooperative: An organization owned by its members that provides electricity service.
Joint action agency: A group formed under state law to provide services like power generation or storage for public utilities.

Limits and Unknowns

The tax exemption for new facilities only applies if they are built and placed into service on or after July 1, 2024.
New electricity generation or storage facilities must be operated by a public utility, a joint action agency, or provide power to specific users not served by utilities as of July 1, 2026.

Bill History

2026-02-18 Text
(S) Heard & Held
2026-02-18 Text
(S) LABOR & COMMERCE at 01:30 PM BELTZ 105 (TSBldg)
2026-02-04 Min
(S) Minutes (SL&C)
2026-02-04 Text
(S) <Bill Hearing Canceled>
2026-02-04 Text
(S) LABOR & COMMERCE at 01:30 PM BELTZ 105 (TSBldg)
2026-01-21 1487
(S) REFERRED TO LABOR & COMMERCE
2026-01-21 1488
(S) GOVERNOR'S TRANSMITTAL LETTER
2026-01-21 1488
(S) FN2: (REV)
2026-01-21 1488
(S) FN1: ZERO(CED)
2026-01-21 1487
(S) L&C, FIN
2026-01-21 1487
(S) READ THE FIRST TIME - REFERRALS

Official Summary Text

TAX: ELECTRIC COOPS/GENERATION/STORAGE
An Act relating to the taxation of electric cooperatives; relating to the taxation of electricity generation and electricity storage facilities; and providing for an effective date.

Current Bill Text

Read the full stored bill text

SB0218A -1- SB 218
New Text Underlined [DELETED TEXT BRACKETED]

34-GS2631\A

SENATE BILL NO. 218

IN THE LEGISLATURE OF THE STATE OF ALASKA

THIRTY-FOURTH LEGISLATURE - SECOND SESSION

BY THE SENATE RULES COMMITTEE BY REQUEST OF THE GOVERNOR

Introduced: 1/21/26
Referred: Labor & Commerce, Finance

A BILL

FOR AN ACT ENTITLED

"An Act relating to the taxation of electric cooperatives; relating to the taxation of 1
electricity generation and electricity storage facilities; and providing for an effective 2
date." 3
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 4
* Section 1. AS 10.25.540 is amended by adding a new subsection to read: 5
(c) An electric cooperative is not subject to state and local ad valorem, 6
income, and excise taxes. 7
* Sec. 2. AS 10.25.570 is amended to read: 8
Sec. 10.25.570. Refund to local governments. The proceeds of the telephone 9
cooperative gross revenue tax [AND THE ELECTRIC COOPERATIVE TAX], less 10
the amount expended by the state in collecting the tax [THEIR COLLECTION], shall 11
be refunded to an organized borough or a city of any class incorporated under state 12
law, in the proportion that the revenue was earned within the city or the borough area 13
outside the city. However, taxes collected on gross revenue earned by a telephone 14
34-GS2631\A
SB 218 -2- SB0218A
New Text Underlined [DELETED TEXT BRACKETED]

cooperative [OR ON THE SALE OF ELECTRICITY BY AN ELECTRIC 1
COOPERATIVE] outside a city or organized borough shall be retained by the state 2
and deposited into its general fund. 3
* Sec. 3. AS 42.45.310(f) is amended to read: 4
(f) Bonds and other obligations issued by the agency and all interest and 5
income from them and all fees, charges, funds, revenue, income, and other money 6
pledged or available to pay or secure the payment of the bonds or obligations or 7
interest on them are exempt from taxation. The real and personal property of the 8
agency and the assets, income, and receipts of the agency are exempt from all taxes 9
and special assessments of the state or a political subdivision of the state [, EXCEPT 10
THAT ELECTRICITY SOLD AT RETAIL BY AN AGENCY IS SUBJECT TO THE 11
ELECTRIC COOPERATIVE TAX (AS 10.25.540 - 10.25.570)]. 12
* Sec. 4. AS 43.98.100(a) is amended to read: 13
(a) An electricity generation facility or electricity storage facility that is 14
constructed and placed into service on or after July 1, 2024, is not subject to state and 15
local ad valorem, income, and excise taxes if the [ELECTRICITY GENERATION] 16
facility is 17
(1) operated by a public utility or joint action agency established under 18
AS 42.45.310; or 19
(2) operated by an entity other than a public utility and provides power 20
(A) only to a public utility; or 21
(B) to an end user who was not receiving electric service 22
from a public utility on July 1, 2026. 23
* Sec. 5. AS 10.25.540(b)(2), 10.25.555, and 10.25.580 are repealed. 24
* Sec. 6. This Act takes effect July 1, 2026. 25