NOTE: A.B. 3723 enacted in May 2018 extends the tax credit available for wind manufactures until July 2024. This provision previously expired on August 2016.
In August 2010 New Jersey enacted legislation (S.B. 2036) creating an offshore wind resource requirement within the state renewables portfolio standard (RPS) and tax incentives for certain businesses engaged in manufacturing wind energy equipment. The term "business" is defined to include corporations subject to the state franchise tax, corporations subject to the state's insurance premiums tax, as well as partnerships, S-corporations, and limited liability corporations. The allowable tax credit is equal to 100% of the qualified capital investment made by a business. The applicant must demonstrate the state's financial support of the facility will yield a net positive benefit for the state. The program is administered by the New Jersey Economic Development Authority (EDA).
The term qualifying wind energy facilities is defined as "any building, complex of buildings, or structural components of buildings, including water access infrastructure, and all machinery and equipment used in the manufacturing, assembly, development or administration of component parts that support the development and operation of a qualified offshore wind project, or other wind energy project* as determined by the authority, and that are located in a wind energy zone." A "wind energy zone" is defined as property within the South Jersey Port District.
The offshore wind portion of this tax credit operates as an addition to 2007 legislation creating the Urban Transit Hub Tax Credit. Tax credits for qualifying wind facilities are generally limited to $100 million in aggregate, although the EDA has discretion to allocate tax credits that exceed this cap to "meritorious" projects if sufficient tax credit volume is available. In total, the EDA may not allocate Urban Transit Hub Tax Credits exceeding $1.75 billion. Businesses must apply for a tax credit to the EDA by July 1st 2024, and submit documentation for approval of the credit amount by July 1st 2027. The tax credit amount can be exercised up to 18 years after the effective date.
*While most sections of S.B. 2036 apply to specifically to offshore wind energy, it appears that based on this definition, wind energy manufacturing facilities in general qualify for tax credits.
|Incentive Type:||Industry Recruitment/Support|
|Administrator:||New Jersey Economic Development Authority|
|Eligible Renewable/Other Technologies:||
|Incentive Amount:||100% of the qualified capital investment|
|Maximum Incentive:||No specific per project limitation; $100 million limit for all offshore wind tax credits (may be exceeded if EDA deems appropriate)|
|Terms:||Minimum $50 million investment and 300 new full-time employees; facilities must be located within a qualified wind energy zone (i.e., the South Jersey Port District); investment must yield a net positive benefit for the state; sales and transfers permitted subject to certain limitations.|
|Name:||N.J. Stat. § 34:1B-207 et seq.|
|Date Enacted:||08/19/2010 (wind energy specific portion; subsequently amended)|
|Effective Date:||08/19/2010 (wind energy specific portion)|
|Name:||N.J. Stat. § 48:3-51|
|Date Enacted:||1999 (subsequently amended)|
|Name:||Business Service Center - NJ EDA|
|Organization:||New Jersey Economic Development Authority|
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.
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