Property Tax Abatement for Production and Manufacturing Facilities

July 14, 2021


In May 2007, Montana enacted legislation (H.B. 3) that allows a property tax abatement for new renewable energy production facilities, new renewable energy manufacturing facilities, and renewable energy research and development equipment. Eligible facilities and equipment are assessed at 50% of their taxable value.

Qualifying renewable energy manufacturing facilities are those that (1) produce materials, components or systems to convert solar, wind, geothermal, biomass, biogas or waste heat resources into useful energy, and (2) whose annual production of renewable energy equipment makes up at least half of the facility's total production. Fuel cells and components of fuel cells that generate energy using non-fossil fuels are also eligible. Qualifying renewable energy production facilities include biomass gasification, biomass, biogas and geothermal facilities. Qualifying renewable energy research and development equipment is considered to be equipment used primarily for research and development of the efficient use of renewable energy sources.

Under this policy, these facilities are assessed at 50% of their taxable value* for the construction period and the first 15 years after the facility commences operation, not to exceed 19 years. To qualify for the tax abatement, facilities must begin construction after June 1, 2007. Additionally, all renewable energy research and development equipment up to $1 million in value may qualify for a 50% property tax abatement if it is placed into service after June 30, 2007. The portion of the equipment used for renewable energy research and development in excess of $1 million in value does not qualify for the abatement. All production facilities, manufacturing facilities, and research and development equipment must be approved by the Montana Department of Environmental Quality in order to qualify for the abatement.

For the purposes of this policy, "renewable energy" is defined as energy from solar, wind, geothermal, biomass, biogas, non petroleum-based fuel cells, and waste heat sources. "Biomass" means any renewable organic matter, including dedicated energy crops and trees, agricultural food and feed crops, agricultural crop wastes and residues, wood wastes and residues, aquatic plants, animal wastes, municipal wastes, and other organic waste materials.

*These types of facilities are categorized as “Class 14” property, which is taxed at 3% of the property’s market value. A facility that qualifies for the 50% property tax abatement is therefore subject to property tax equal to 1.5% of the property’s market value.

Program Overview

Implementing Sector: State
Category: Financial Incentive
State: Montana
Incentive Type: Industry Recruitment/Support
Web Site:
Administrator: Montana Department of Revenue
Start Date: 5/25/2007
Eligible Renewable/Other Technologies:
  • Solar Water Heat
  • Solar Space Heat
  • Geothermal Electric
  • Solar Thermal Electric
  • Solar Thermal Process Heat
  • Solar Photovoltaics
  • Wind (All)
  • Biomass
  • Hydrogen
  • Municipal Solid Waste
  • Combined Heat & Power
  • Landfill Gas
  • Solar Pool Heating
  • Wind (Small)
  • Anaerobic Digestion
  • Fuel Cells using Renewable Fuels
Incentive Amount: 50% tax abatement


Name: MCA § 15-24-3111
Date Enacted: 5/25/2007
Effective Date: 5/25/2007
Name: MCA § 15-6-157
Date Enacted: 5/25/2007
Effective Date: 5/25/2007
Name: ARM 17.80.201 and 17.80.202
Date Enacted: 03/2008
Effective Date: 05/23/2008


Name: Information Specialist - MT Dept. of Rev.
Organization: Montana Department of Revenue
Address: P.O. Box 8018
Helena MT 59604-5805
Phone: (406) 444-6900
Name: Chris Dorrington
Organization: Montana Department of Environmental Quality
Address: 1520 East Sixth Ave
Helena MT 59620-0901
Phone: (406) 444-2544

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.