SENATE, No. 2328
STATE OF NEW JERSEY
INTRODUCED DECEMBER 11, 1997
By Senators KYRILLOS and KENNY
An Act concerning the petroleum products gross receipts taxes for fuel used to generate certain electricity, supplementing P.L.1990, c.42.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. (New section.) a. "Gross receipts" shall not include receipts from sales of petroleum products used by a utility, a co-generation facility or a wholesale generation facility to generate electricity that is sold for resale or to an end user other than the end user upon whose property is located the co-generation facility that generated the electricity or upon the property purchased or leased from the end user by the person owning the co-generation facility if such property is contiguous to the user's property and is the property upon which is located a co-generation facility that generated the electricity.
b. For the purposes of P.L.1990, c.42 (C.54:15B-1 et seq.):
"Co-generation facility" means a facility the primary purpose of which is the sequential production of electricity and steam or other forms of useful energy that are used for industrial or commercial heating or cooling purposes and which is designated by the Federal Energy Regulatory Commission, or its successor, as a "qualifying facility" pursuant to the provisions of the "Public Utility Regulatory Policies Act of 1978," Pub.L.95-617.
"Wholesale generation facility" means a facility the primary purpose of which is the sequential production of electricity to be sold exclusively at wholesale as determined by the Federal Energy Regulatory Commission, or its successor, as an "exempt wholesale generator" pursuant to the provisions of section 32 of the "Public Utility Holding Company Act of 1935," (15 U.S.C.s.79z-5a).
2. This act shall take effect immediately and apply to petroleum products delivered for use or consumption on or after the first day of the quarterly period next following enactment.
The petroleum products gross receipts tax is imposed on most first sales and uses of petroleum products in this State at a rate of 2.75% of the purchase price of the petroleum products. Fuel oils, such as diesel fuel, that are taxable under the motor fuels tax are taxed at a cents-per-gallon-rate based on the price of gasoline, which is currently higher than 2.75% of the purchase price on diesel fuel.
This bill exempts fuel oil purchased by utilities and co-generators for use to generate electricity sold at wholesale or at certain retail sales from the petroleum products gross receipts tax.
Provides petroleum products gross receipts tax exemption for fuel oil used by certain electricity generators.