Large Wind Property Tax Reduction

Summary

In 2001, North Dakota established property tax reductions for commercial wind turbines constructed before 2011. Originally, the law reduced the taxable value of centrally-assessed* wind turbines with a capacity of 100 kilowatts (kW) or greater from 10% to 3% of assessed value, resulting in a property tax savings of 70%. This law has since been amended, resulting in the establishment of slightly different tax valuation procedures for some installations.

Currently, all centrally-assessed wind turbines with a capacity of 100 kW or greater that are constructed after June 30, 2006, and before January 1, 2015, are valued at 1.5% of their assessed value, as are units constructed after April 30, 2005, and before July 1, 2006, and for which a power purchase agreement (PPA) was executed after April 30, 2005, and before January 1, 2006. For the latter category, the reduced valuation applies only for the duration of the original PPA. All other centrally-assessed wind turbines with a capacity of 100 kW or greater are valued at 3% of assessed value.

North Dakota also offers a property tax exemption for some types of locally-assessed renewable energy systems.
 

*  While most property tax assessments in North Dakota take place at the local level, the State Board of Equalization values investor-owned utilities (IOUs) for property tax purposes. Thus, this reduction will generally apply only to IOUs engaged in the operation of commercial wind farms.