Wood Energy Production Credit

March 12, 2024


The Wood Energy Tax Credit allows individuals or businesses processing Missouri forestry industry residues into fuels a state income tax credit of $5.00 per ton of processed material (e.g., wood pellets). A multiplier of 4 applies to charcoal, based on the amount of Missouri forest industry residue required to produce one ton of charcoal. Any amount of credit exceeding the tax due by a company in the year of production may be carried over to a subsequent taxable year, not to exceed four years. A credit earned under this program may also be transferred to third parties for use within this five-year period. To be considered an eligible fuel, forestry industry residues must have undergone some thermal, chemical or mechanical process(es) sufficient to alter the residues into a fuel product. In 2022, H.B. 3 extended the tax credit to June 30, 2028, established an annual cap of $6 million per fiscal year, and added a requirement that an appropriation for the tax credits needs to be made before they are authorized.

Click here to access Missouri's Wood Energy Tax Credit Application Form.

Program Overview

Implementing Sector: State
Category: Financial Incentive
State: Missouri
Incentive Type: Corporate Tax Credit
Web Site: https://dnr.mo.gov/energy/business-industry/wood-energy-tax-credit
Administrator: Division of Energy
Start Date: (subsequently amended)
Eligible Renewable/Other Technologies:
  • Biomass
Incentive Amount: $5 per ton of processed materials
Maximum Incentive: Credit may be claimed for a period of five years; total tax credits cap set at $6,000,000 annually, subject to appropriations
Carryover Provisions: Excess credit may be carried over for four years


This program has 1 incentives
Technologies: Biomass
Sectors: Commercial, Industrial
Parameters: The incentive is 5.00 $/ton


Name: 135.305.1 R.S. Mo., et seq.
Effective Date: 01/01/1997 (subsequently amended)
Expiration Date: 06/30/2020
Name: Definitions/Description Under 10 CSR 140-4.010
Effective Date: 12/30/1998 (most recent revision)


Name: Missouri Department of Economic Development Division of Energy
Organization: Missouri Department of Economic Development,
Address: 1101 Riverside Drive
Jefferson City MO 65102
Phone: (573) 751-2254
Email: energy@dnr.mo.gov

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.