Navigate Up
Sign In
Last Updated: 11/28/2018

Energy Production Taxes

Contact Us

Energy Production Taxes

651-556-6091
7:30 a.m.- 4:00 p.m. Mon.-Fri.

more

Top FAQs

Related Information

About This Page

Energy Production Taxes are taxes on the energy produced by means of a solar energy generating system or wind energy conversion system.
 

Solar Energy 

A solar energy generating system (SEGS) is a set of devices whose primary purpose is to produce electricity by means of collecting, transferring, or converting solar generated energy.

The Solar Energy Production Tax rate is $1.20 per megawatt hour produced.

The Solar Energy Production Tax applies to SEGS with an alternating current (AC) nameplate capacity exceeding 1 megawatt.

SEGS with an AC nameplate capacity of 1 megawatt or less are exempt from the Energy Production Tax.

Solar Energy Production Report

You must file a Solar Energy Production report if you have a SEGS whose primary purpose is to produce electricity by means of any combination of collecting, transferring, or converting solar generated energy.
 

Filing

You must file the Solar Energy Production report online through our e-Services system. Details on filing are found in the Solar Energy Production Report Instructions.

You will need to register for an Energy Production Account before you can file. Register by calling Business Registration at 651-282-5225.
 

Deadline

The Solar Energy Production Tax report is due annually on January 15.

An extension of up to 15 days may be granted if a written request showing good cause is submitted. For more information, visit the extension request instructions.

If you do not file on time, we will determine your tax by applying a production rate of 30% to the combined nameplate capacity of your system.

 

Determining Your Tax

The department will determine the tax due and notify you and the counties where the systems are located by February 28.

Unless the systems are interconnected with different distribution systems, the nameplate capacity of an SEGS shall be combined with the nameplate capacity of any other solar energy generating system if the systems:
  • are constructed within the same 12-month period; and
  • exhibit characteristics of being a single development.

In the case of a disagreement with the department of revenue on the combined nameplate capacity of your system, the department of commerce shall determine the total size of the system. 

 

Paying the Tax

The counties where the systems are located will send you the tax bills. You must pay the tax to the appropriate county treasurers by May 15.
 

Wind Energy

A wind energy conversion system (WECS) is any device that converts wind energy to a usable form of energy. 

The Wind Energy Production Tax rate varies, based on the combined nameplate capacity of the WECS being taxed. The table below shows the tax rates in megawatt (MW) hour.  

 
Type of WECS ​Nameplate Capacity
(MW)
​Tax per Megawatt Hour
​Large Scale ​Over 12 ​$1.20
​Medium Scale ​Between 2 and 12 ​$0.36
​Small Scale ​2 and under ​$0.12
 

The Wind Energy Production Tax applies to WECS installed after January 1, 1999, unless the system is exempt from tax or the system.

The following WECS are exempt from the Energy Production Tax.

 
  • WECS with a nameplate capacity of 0.25 megawatts or less; and
  • WECS owned by a municipality and with a nameplate capacity of 2 megawatts or less. 
 

Wind Energy Production Report

You must file a Wind Energy Production report if you have a WECS that converts wind energy to usable form of energy.

Filing

You must file the Wind Energy Production report online through our e-Services system. Details on filing are found in the Wind Energy Production Report Instructions.

You will need to register for an Energy Production Account before you can file. Register by calling Business Registration at 651-282-5225.

 

Deadline

The Wind Energy Production Tax report is due annually on January 15.

An extension of up to 15 days may be granted if a written request showing good cause is submitted. For more information, visit the extension request instructions.

If you do not file on time, we will determine your tax by applying a production rate of 60% to the combined nameplate capacity of your system.

 

Determining Your Tax

The department will determine the tax due and notify you and the counties where the systems are located by February 28.

The nameplate capacities of wind energy conversion systems under common ownership will be combined if the systems:

  • are located within 5 miles of each other; and
  • were constructed in the same 12 month period.

Common ownership exists when the same, or similar, persons or entities own two or more systems, even if the ownership shares are different for each system. Common ownership does not exist solely because the same person or entity provided equity financing.   

In the case of a disagreement with the department of revenue on the combined nameplate capacity of your system, the department of commerce shall determine the total size of the system.

 

Paying the Tax

The counties where the systems are located will send you the tax bills. You must pay the tax to the appropriate county treasurers by May 15.