Property Tax Exemption for Residential Renewable Energy Equipment

March 24, 2023


Property Tax Exemption

Renewable energy personal property that is located on a residential classified property, owned by the residential property owner, and produces energy that is used by the residential property is exempt from Colorado property taxation.

Independently owned residential solar electric generation facilities that meet the criteria listed in § 39-1-102 (6.8), C.R.S. are exempt from Colorado property taxation under § 39-3-102, C.R.S. To qualify for the exemption the solar electric generation facility must be located on residential real property, used to produce electricity from solar energy primarily for use in the residential improvements, and have a production capacity of no more than one hundred 100 kilowatts of AC electricity. Energy storage systems connected to the generation system are included as part of the facility.

Eligible Technologies

Most locally assessed renewable energy property meet the criteria to be classified as personal property under § 39-1-102 (11), C.R.S. 

For Colorado property taxation purposes, solar energy facilities (e.g., PV panels, community solar gardens) property used to produce 2 megawatts (MW) or less of AC electricity and wind energy facilities property used to produce 2 MW or less of AC electricity are locally assessed. In addition, locally assessed renewable energy property includes small or low impact hydroelectric facilities, geothermal energy facilities, and biomass energy facilities as defined in § 39-4-101, C.R.S., used to produce 2 MW or less of AC electricity and placed into use prior to January 1, 2010. Community solar gardens are classified as locally assessed properties. Energy storage systems connected to the generation system are included as a part of the facility for valuation purposes.

Ineligible Technologies

Renewable energy property in Colorado is taxable unless specifically exempt by the Colorado Constitution.

All renewable energy systems with greater than 2 MW of AC electricity generation capacity are valued as public utility property by the State Assessed Properties Section of the Division of Property Taxation (Division). Small or low impact hydroelectric facilities, geothermal energy facilities, and biomass energy facilities, as defined in 39-4-101, C.R.S., that are put into use on or after January 1, 2010 and not primarily designed to supply electricity for consumption on site are state assessed regardless of AC generation capacity.

Program Overview

Implementing Sector: State
Category: Financial Incentive
State: Colorado
Incentive Type: Property Tax Incentive
Web Site:
Administrator: Division of Property Taxation / Local Assessors
Start Date:
Eligible Renewable/Other Technologies: Solar Photovoltaics,Lithium-ion
Incentive Amount: 100% exemption for renewable energy system property
Equipment Requirements: Energy produced by the system must be used on-site


Name: C.R.S. 39-3-102
Name: Colorado Assessors' Reference Library, Volume 5, Personal Property Manual, Renewable Energy Property Assessment


Name: Michael Krueger
Address: 1313 Sherman Street, #419
Denver CO 80203
Phone: (303) 864-7792

This information is sourced from DSIRE; the most comprehensive source of information on incentives and policies that support renewables and energy efficiency in the United States. Established in 1995, DSIRE is operated by the N.C. Clean Energy Technology Center at N.C. State University.