Renewable Energy Systems Sales Tax Exemption

Last updated: August 28, 2018

Program Overview

Implementing Sector:State
Category:Financial Incentive
State:Vermont
Incentive Type:Sales Tax Incentive
Start Date:01/26/1999
Eligible Renewable/Other Technologies:Solar Water Heat, Solar Thermal Electric, Solar Photovoltaics, Wind (All), Biomass, Combined Heat & Power, Landfill Gas, Wind (Small), Anaerobic Digestion, Fuel Cells using Renewable Fuels

Authorities

Name:32 V.S.A. § 9741(46)
Date Enacted:1999 (subsequently amended)

Summary

Vermont's sales tax exemption for renewable energy systems, originally enacted as part of the Miscellaneous Tax Reduction Act of 1999 (H.B. 0548), initially applied only to net-metered systems. The exemption now generally applies to systems up to 500 kilowatts (kW) in capacity that generate electricity using eligible "renewable energy" resources (as defined under 30 V.S.A. § 8002), to micro-combined heat and power (CHP) systems up to 20 kW, and to solar water-heating systems. The exemption is available for grid-tied systems and off-grid systems alike. Vermont's sales tax rate is 6%.

"Renewable energy" is defined under 30 V.S.A. § 8002 as "energy produced using a technology that relies on a resource that is being consumed at a harvest rate at or below its natural regeneration rate." Biogas from sewage treatment plants and landfills, and anaerobic digestion of agricultural products, byproducts, and wastes are explicitly included. (The term "renewable energy" explicitly excludes solid waste that is not agricultural or silvicultural, as well as nuclear fuel, coal, oil, propane, and natural gas).

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