Property Valuation for Commercial Wind Energy Equipment

June 26, 2020


Note: The Trending Factor used for Assessment Year 2020 is 1.27.

In October 2007, Illinois passed Public Act 095-0644, providing consistent valuation procedures for commercial wind farm equipment (amended via H.B. 4797 in 2010). Beginning in the 2007 assessment year, wind energy devices larger than 500 kilowatts (kW) and producing power for commercial sale will be valued at $360,000 per megawatt (MW) of capacity, annually adjusted for inflation according to the U.S. Consumer Price Index; the Department of Revenue annually publishes this adjustment ("trending factor"), available here. This figure is termed the trended real property cost basis. Because Illinois assesses property for property tax purposes at one-third of its fair cash value, in practice the assessed value of commercial wind energy property is $119,988 per MW.

The law also defines an allowance for physical depreciation of the device, calculated by dividing the age of the turbine by 25 and then multiplying the result by the trended real property cost basis. The physical depreciation allowance may not exceed 70% of the trended real property cost basis, though additional depreciation allowances may be granted for functional or external obsolescence.


Prior to 2007, wind energy devices generating electricity for commercial sale were assessed differently depending on where they were located. Some counties valued the entire turbine structure (tower plus generation equipment) as "real property", subject to taxation, while others deemed only the tower portion as taxable property. This difference in valuation procedure meant that the taxable value of identical wind turbines could vary by as much as 75% from county to county, creating dramatically different tax loads and complicating projects that cross county lines.

Program Overview

Implementing Sector: State
Category: Financial Incentive
State: Illinois
Incentive Type: Property Tax Incentive
Web Site:
Administrator: Illinois Department of Commerce and Economic Opportunity
Start Date:
Eligible Renewable/Other Technologies:
  • Wind (All)
Incentive Amount: Valuation: $360,000 per MW (annually adjusted for inflation)
Depreciation: Up to 70% of the trended real property cost basis
Maximum Incentive: Not applicable
Eligible System Size: 500 kW and larger
Equipment Requirements: None specified


Name: § 35 ILCS 200/10-600 et seq.
Date Enacted: 10/17/2007
Effective Date: 01/01/2007


Name: Public Information
Organization: Illinois Department of Revenue
Address: Willard Ice Building
Springfield IL 62702
Phone: (800) 732-8866
Name: Kara Moretto
Organization: Illinois Department of Revenue
Address: Willard Ice Building
Springfield IL 62702
Phone: (800) 732-8866

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.