|Uniform Capacity Tax and Exemption for Solar
|Department of Taxes
Statewide Education Property Tax
Vermont fully exempts solar photovoltaic (PV) systems up to 50 kilowatts (kW) from the statewide education property tax. For systems 50 kW and greater, the state assesses a uniform tax of $4.00 per kilowatt (kW) in lieu of the statewide education property tax. This applies to the equipment, not to the land.
Municipal Property Tax
A system up to 50 kW that is net-metered OR is not connected to the grid and only provides power to the property on which it is located is also exempt from municipal property taxes. A system up to 50 kW that is not net-metered and is connected to the grid OR is not connected to the grid but provides power to multiple properties is subject to municipal property taxes, unless the municipality has created a local exemption.
Systems 50 kW and greater that are net-metered may reduce their capacity by 50 kW for valuation purposes if they are subject to municipal property taxes.
Enclosures or Buildings Housing Batteries
Associated enclosures or buildings that house batteries that are not authorized under the same Certificate of Public Good (CPG) as the solar facility are valued as real property for both municipal and education taxes. If the enclosure or building housing batteries is authorized under the same CPG, then the enclosure or structure should be valued as real property for municipal taxes only.
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)"