|Program Type||Property tax exemption|
Solar: Photovoltaics, passive solar space heat, solar hot water, solar space heat, solar thermal electric, solar thermal process heat, solar cooling, solar pool heating, daylighting. Landfill gas, wind, biomass, geothermal electric, geothermal heat pumps, CHP/cogeneration, anaerobic digestion, small hydroelectric.
|Amount||Exempts any increased value of the property due to installation of energy equipment|
|Required Documentation||Documentation of purchase and installation of equipment|
|Official Web Site||http://www.revenue.state.az.us/|
Arizona does not consider renewable energy-generating devices to add value to property—which means consumers don’t get taxed on the value added to the property by the energy installation.
Under Arizona’s law, both “active” and “passive” systems are eligible for the credit. If the system in question generates renewable energy like a photovoltaic system or wind turbine it’s considered an active system. Passive systems, like solar water heaters or solar daylighting systems, can qualify as well, as long as it’s clear that the system in question is specifically designed to replace or offset an existing power need.
The exemption was created under state law HB-2429 and expanded by HB-2332 defines “energy equipment” as equipment that harness energy equipment to produce energy primarily for on-site consumption from renewable resources, including wind, forest thinnings, agricultural waste, biogas, biomass, geothermal, and low-impact hydropower. It also includes high performance building components in buildings or building components that meet or exceed the energy efficiencies of programs including Energy Star or LEED.
To qualify for the exemption, property owners need to provide their county assessor with documentation of the purchase and installation of the equipment within six months. There’s no limit on this exemption—consumers can install as much qualifying equipment as they want, property tax-free.