Sales Tax Credit for Clean Energy Technology

May 22, 2024


Tenn. Code Ann. Section 67-6-346 allows a taxpayer to take a credit, apply for a refund of taxes paid, or to apply for authority to make tax-exempt purchases of machinery and equipment used to produce electricity in a certified green energy production facility. A certified green energy production facility is a facility certified by the Department of Environment and Conservation as producing electricity for use and consumption off the premises using clean energy technology. Clean energy technology is a technology used to generate or store electricity from geothermal, hydrogen, solar, or wind sources. CHP facilities utilizing natural gas for heat production and electricity for on-site consumption are also included.

A contractor who is installing pollution control or green energy machinery and equipment must file an application with the department and must attach a copy of the contract to its application. The taxpayer who hires a contractor must also file an application with the department. If both applications are approved, the authority to purchase tax-exempt will be extended to the contractor for the certified green energy production facility project described in the application. If taxes have been paid, the approved application will be used to support a refund or credit directly to the taxpayer.

Program Overview

Implementing Sector: State
Category: Financial Incentive
State: Tennessee
Incentive Type: Sales Tax Incentive
Web Site:
Administrator: Tennessee Department of Revenue
Start Date: 6/30/2010
Eligible Renewable/Other Technologies:
  • Geothermal Electric
  • Solar Photovoltaics
  • Wind (All)
  • Biomass
  • Hydrogen
  • Combined Heat & Power
  • Wind (Small)
  • Lithium-ion
Incentive Amount: 100% of sales and use tax
Equipment Requirements: Certified green energy production facility as defined in Tenn. Code Ann. Section 67-4-2004


This program has 1 incentives
Technologies: Geothermal Electric, Solar Photovoltaics, Wind (All), Combined Heat & Power, Wind (Small), Lithium-ion
Sectors: Commercial, Industrial
Parameters: The incentive is 100.00 %


Name: Tenn. Code 67-6-346
Effective Date: 6/30/2010
Name: Tenn. Code 67-4-2004 (9)
Effective Date: 6/30/2011


Name: Tennessee Department of Revenue
Address: 500 Deaderick Street
Nashville TN 37242
Phone: (615) 253-0600

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.