Sales Tax Exemption for Wind, Other Generators and Hydrogen Facilities

Summary

North Dakota offers a sales and use tax exemption for hydrogen facilities, large wind turbines and certain other facilities that generate electric power. The sales tax exemption for wind energy is available to the owners of wind farms that include at least one turbine with a nameplate capacity of 100 kilowatts (kW) or greater. In April 2007, the exemption was extended to the owners of any other electricity-generating facility with a capacity of 100 kW or greater that produces electricity for resale or for use in a business activity. The exemption applies to building materials, production equipment and other tangible personal property used in the construction of the facility. The exemption applies to any sales or use tax that would be due resulting from eligible generators constructed before January 1, 2011. Generators must receive prior approval from the State Tax Commissioner to qualify for the exemption at the time of the purchase. If prior approval is not received, the owner must pay the tax and then apply to the State Tax Commissioner for a refund. Under a separate statute, a sales and use tax exemption is available to owners of hydrogen facilities and the production, storage and transportation equipment used by a facility engaged in hydrogen generation. Hydrogen may be used to power an internal combustion engine or fuel cell. "Storage" is defined as "stationary and portable hydrogen containers or pressure vessels, piping, tubing, fittings, gaskets, controls, valves, gauges, pressure regulators, safety relief devices, and other accessories intended for hydrogen storage containers or pressure vessels."