Uniform Capacity Tax and Exemption for Solar

May 22, 2024

Summary

Uniform Capacity Tax

Solar photovoltaic (PV) systems 50 kW or greater have a uniform capacity tax rate of $4.00/kW capacity, while systems less than 50 kW are exempt. Energy storage facilities with a plant energy rating of 600 kWh or greater have a tax rate of $0.50/kWh of plant energy rate, while energy storage facilities with a plant energy rating less than 600 kWh are exempt.

Statewide Education Property Tax

Vermont fully exempts solar PV systems 50 kW or greater from the statewide education property tax.  For systems less than 50 kW, the state grants a full exemption only if net-metered OR not connected to the grid. This applies to the equipment, not to the land. Energy storage facilities with an energy rating of 600 kWh or greater are exempt from the statewide education property tax, in addition to facilities with a rating of less than 600 kWh.

Municipal Property Tax

A system with a capacity greater than or equal to 50 kW is taxed unless locally exempt. A system up to 50 kW that is net-metered OR is not connected to the grid is exempt. Energy storage facilities with a plant energy rating of 600 kWh or greater are given an appraisal value of $0.25/kWh unless exempted locally; while facilities with a rating of less than 600 kWh are exempt.

For a discussion of Vermont's property tax system and the recommendations to the legislature prior to this law's enactment, see the January 17, 2012 report by the Vermont Division of Property Valuation and Review and the Vermont Commissioner of Public Service: "Valuation of Renewable Energy Property, Report on the (Sec. 12 of Act 45 of 2011)"

Program Overview

Implementing Sector: State
Category: Financial Incentive
State: Vermont
Incentive Type: Property Tax Incentive
Web Site: https://tax.vermont.gov/municipal-officials/solar-plant-taxation
Administrator: Department of Taxes
Start Date: 01/01/2013
Eligible Renewable/Other Technologies:
  • Solar Photovoltaics
  • Lithium-ion
Incentive Amount: Uniform Capacity Tax Exemption:
Solar Plants (Less than 50 kW)
Energy Storage (Rating less than 600 kWh)

Education Property Tax:
Solar Plants (50 kW or more)
Solar Plants (Less than 50 kW; if net-metered or not grid connected)
Energy Storage (Rating of 600 kWh or more)
Energy Storage (Rating less than 600 kWh)

Municipal Property Tax:
Solar Plants (Less than 50 kW; if net-metered or not grid connected)
Energy Storage (Rating less than 600 kWh)

Incentives

This program has 1 incentives
Technologies: Solar Photovoltaics, Lithium-ion
Sectors: Commercial, Industrial, Residential, Agricultural, Multifamily Residential
Parameters: The incentive is 100.00 %

Authorities

Name: 32 V.S.A. § 8701
Name: 32 V.S.A. § 3802(17)

Contact

Name: Vermont Department of Taxes
Address: 133 State Street
Montpelier VT 05633
Phone: (802) 828-2505
Email: tax.vttaxdept@vermont.gov

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.