Renewable Energy System Exemption

Program Overview

Implementing Sector State
Category Financial Incentive
State South Dakota
Incentive Type Property Tax Incentive
Administrator S.D. Department of Revenue
Eligible Renewable/Other Technologies Solar Water Heat, Solar Space Heat, Geothermal Electric, Solar Thermal Electric, Solar Thermal Process Heat, Solar Photovoltaics, Wind (All), Biomass, Hydroelectric, Hydrogen, Geothermal Heat Pumps, Municipal Solid Waste, Combined Heat & Power, Landfill Gas, Solar Pool Heating, Wind (Small), Hydroelectric (Small), Geothermal Direct-Use, Anaerobic Digestion
Applicable Sectors Commercial, Industrial, Residential, Agricultural
Incentive Amount $50,000 or 70% of the assessed value of eligible property, whichever is greater, is exempt
Maximum Incentive $50,000 or 70% of the assessed value of eligible property, whichever is greater
Eligible System Size Less than 5 MW

Summary

In March 2010, South Dakota established a new property tax incentive that replaced two existing property tax incentives for renewable energy. Facilities that generate electricity using wind, solar, hydro, hydrogen generated by another eligible resource, or biomass resources are eligible for this incentive, as are facilities that generate other forms of energy using solar or geothermal resources.

For eligible facilities less than 5 megawatts (MW) in capacity, all real property used or constructed for the purpose of producing electricity is assessed in the same manner as other real property. However, the first $50,000 or 70% of the assessed value of eligible property, whichever is greater, is exempt from the real property tax. For geothermal systems that produce thermal energy, but not electricity, this exemption is limited to the first four continuous years for residential systems and to the first three continuous years for commercial systems.

Authorities

Name SDCL § 10-4-42 et seq.
Date Enacted 3/26/2010
Effective Date 7/1/2010

Contact

 

Address:
445 East Capitol Avenue
Pierre, SD 57501-3185
Phone:
(605) 773-3311
E-Mail: