Washington State Considers Tax on Renewable Energy Systems | HB 1960
- February 25, 2026 – House Bill 1960, proposing an excise tax on renewable energy systems in Washington state, is advancing through the state legislature.
- The legislation aims to generate revenue earmarked for local governments and tribal grants, according to a bill summary available on the Washington State Legislature website.
- HB 1960 is described as a measure “encouraging renewable energy in Washington through tax policy and investment in local communities.” Sponsors of the bill include Representatives Ramel, Berg,...
Washington State Bill Aims to Fund Local Communities, Tribal Grants Through Renewable Energy Tax
– House Bill 1960, proposing an excise tax on renewable energy systems in Washington state, is advancing through the state legislature. The bill passed the House on Monday with a vote of 75 to 15 and has been sent to the Senate for consideration.
The legislation aims to generate revenue earmarked for local governments and tribal grants, according to a bill summary available on the Washington State Legislature website. At least 75% of the funds collected would be distributed to local jurisdictions using the same ratio as existing local property taxes. The remaining 25% would be allocated to a grant program specifically designed to support renewable energy initiatives within Washington state tribes.
HB 1960 is described as a measure “encouraging renewable energy in Washington through tax policy and investment in local communities.” Sponsors of the bill include Representatives Ramel, Berg, Doglio, Fitzgibbon, Parshley, Scott, Reed and Hill.
The bill’s progress follows a series of actions in the House. It was prefiled for introduction on , and received its first reading and referral to the Finance Committee on . A public hearing was held in the House Committee on Finance on , and executive action was taken by the committee on , resulting in a recommendation to pass the first substitute bill.
As of , the current version of the bill is the Engrossed 3rd substitute – E3SHB 1960. It is currently in the Senate Ways & Means Committee. The bill’s journey through the legislature can be tracked on the official legislative website, offering access to bill history, roll calls, and related documents.
The proposed tax rate, as detailed in documents available through LegiScan, is $968 per year per megawatt of nameplate capacity of energy generating systems. This excise tax is intended to provide a dedicated funding stream for local and tribal renewable energy projects.
The move comes as Washington state continues to explore avenues for expanding renewable energy sources. While the bill focuses on a tax mechanism, it reflects a broader effort to incentivize sustainable energy practices and support communities involved in the transition to a cleaner energy future. The Senate’s consideration of HB 1960 will be a key step in determining whether this funding mechanism will be implemented statewide.