Renewable Energy Systems Tax Credit (Corporate)

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Eligibility: 
Commercial
Construction
Residential
Installers/Contractors
Multifamily Residential
Savings Category: 
Solar - Passive
Solar Water Heat
Solar Space Heat
Geothermal Electric
Solar Thermal Electric
Solar Thermal Process Heat
Solar Photovoltaics
Wind (All)
Biomass
Hydroelectric
Geothermal Heat Pumps
Landfill Gas
Solar Pool Heating
Wind (Small)
Geothermal Direct-Use
Anaerobic Digestion
Maximum Rebate: 

Residential: $2,000
Commercial Production Tax Credit: No limit
Commercial Investment Tax Credit: $50,000

Program Info
Sector Name: 
State
Administrator: 
State Energy Program, State Tax Commission
State: 
Utah
Program Type: 
Corporate Tax Credit
Rebate Amount: 

Commercial wind, geothermal electric, and biomass systems 660 kW or greater, and solar PV systems 2 MW or greater: 0.35¢/kWh ($0.0035/kWh) for 4 years
Other commercial technologies and commercial wind, geothermal electric, solar PV, and biomass systems smaller than 600 kW: 10% of installed cost
Photovoltaic systems between 660 kW and 2 MW: May choose either 0.35¢/kWh ($0.0035/kWh) for 4 years or 10% of installed cost

Summary: 
Utah's individual income tax credit for renewable energy systems includes provisions for both residential and commercial applications. The Utah Office of Energy Development administers the tax credit and has responsibility for revising the tax credit rules and certifying systems as eligible for the credit. Legislation (section 5) enacted in 2007 extended these tax credits through at least 2012. On or before this time, and every five years thereafter, the Utah Tax Review Commission must review the tax credit and make recommendations as to whether the tax credit should be continued, modified, or repealed. 

Residential Systems:

The individual income tax credit for residential systems is 25% of the reasonable installed system costs up to a maximum credit of $2,000 per residential unit. The residential credit is nonrefundable, but unused credit may be carried over up to four years. A non-business entity that leases a residential system is eligible for the credit and may use the credit for no more than seven years from the initiation of the lease.

Eligible residential systems include active and passive solar thermal systems; solar electric systems; wind turbines; hydro (water) energy; geothermal heat pumps; direct-use geothermal; and biomass. Note that eligible biomass systems must produce either fuel or electricity. Biomass heating systems are not eligible.

Under the corporate tax credit language, a builder can take a tax credit for the installation of a renewable energy system on a residential unit.

Commercial Systems:

The tax credit for commercial systems is structured as a refundable credit. Eligible commercial systems include active and passive solar thermal systems; solar electric systems; wind turbines; hydro (water) energy; geothermal heat pumps; direct-use geothermal; and geothermal electricity; and biomass systems. Note that eligible biomass systems must produce either fuel or electricity. Biomass heating systems are not eligible. Renewable energy systems may be used to supply energy to a commercial unit or as a commercial enterprise selling the energy. S.B. 14, passed in 2015, clarified that the corporate tax credit can be applied by any taxpayer that owns a "commercial energy system", and thereby eliminated the requirement that a "business entity" is the only one who can take the corporate credit.

Investment Tax Credit

For wind, geothermal electric, and biomass systems with a total capacity of less than 660 kW, solar photovoltaic (PV) systems up to 2 megawatts (MW), and all other eligible renewable energy systems of any size the credit is worth 10% of the reasonable installed costs up to $50,000. A business entity that leases a commercial system is eligible for the credit and may use the credit for no more than seven years from the initiation of the lease. 

Production Tax Credit

For commercial wind, geothermal electric, and biomass systems with a total capacity of 660 kW or greater, the credit is 0.35¢/kWh ($0.0035/kWh) for four years. The credit may not be carried forward or back. A business entity that leases a commercial system is also eligible for the credit. Solar PV systems greater than 2 MW may only claim the production tax credit, and systems between 660 kW and 2 MW can choose either the production tax credit or the investment tax credit.