Solar & Battery Regulation & Incentive Programs

Renewable Energy Tax Credit for International Operations Centers (Personal)

Program Overview


Category:
Financial Incentive
Program Type:
Personal Tax Credit
Implementing Sector:
State
State:
Arizona
Eligible Storage Technologies:
Solar Thermal Electric, Solar Photovoltaics, Wind (All), Biomass, Landfill Gas, Anaerobic Digestion, Fuel Cells using Renewable Fuels
Website:
http://www.azdor.gov/TaxCredits/RenewableEnergyforSelfConsumption.aspx
Incentive Amount:
$5 million per year for five years for each renewable energy facility
Maximum Incentive:
$5 million per taxpayer per year;
Aggregate cap of $10 million per year for all taxpayers combined
Eligible System Size:
Systems must be at least 20 MW or a typical annual generation of at least 40,000 MWh;

Manufacturers: The taxpayer must make a minimum investment of $300 million in new renewable energy facilities

International Operations Centers: The taxpayer must make a minimum investment of $100 million in new renewable energy facilities
Equipment Requirements:
Manufacturers: At least 90% of the energy produced by the system must be used for on-site self-consumption

International Operations Centers: By the fifth year the system is in operation, at least 51% of the energy must be used on-site
Carryover Provisions:
Excess credit may be carried forward for up to 5 years
Applicable Sectors:
Industrial
Budget :
$10 million per year
Start Date:
07/24/2014
Expiration Date:
12/31/2025
Last Updated:
05/30/2017

Summary

Note: H.B. 2528, enacted in May 2017, amended this tax credit so that it will no longer available to manufacturing facilities beginning in 2018. 

S.B. 1484 of 2014 provides a tax credit for new renewable energy systems that produce energy for self-consumption and are used primarily for manufacturing. H.B. 2670 of 2015 expanded this credit to include renewable energy systems that produce energy for self-consumption by “international operations centers.” H.B. 2528 of 2017 removes eligibility for manufacturers beginning in 2018.

Eligible systems must have a capacity of at least 20 megawatts (MW) or have a typical annual generation of at least 40,000 megawatt-hours (MWh). The tax credit is worth $5 million per year for five years for each facility. 

Taxpayers must first apply to the Department of Revenue on a form prescribed by the Department. The Department will pre-approve taxpayers on a first-come, first-served basis until it has pre-approved a total of $10 million credits in each year. Program guidelines and application for pre-approval of the credit are available here

Manufacturers

In order to qualify for a tax credit, the taxpayer must invest at least $300 million in new renewable energy facilities. At least 90% of the energy produced by the system must be used for self-consumption in the state.

International Operations Centers

To qualify as an international operations center, the owner or operator must make a minimum annual investment of $100 million in new capital assets in each of ten consecutive years. Investments greater than $100 million in any taxable year may be carried forward as a credit toward the investment requirements of subsequent years. On or before the tenth anniversary of certification as a international operations center, the owner or operator must make a total investment of at least $1.25 billion in new capital assets. In order to qualify for a tax credit, the international operations center must invest at least $100 million in new renewable energy facilities. By the fifth year the system is in operation, at least 51% of the energy must be used onsite.

For the purposes of this tax credit, renewable energy includes a variety of biomass resources, solar thermal electric, solar photovoltaics, and wind. 


Authorities

NameEnacted DateEffective DateExpired Date
A.R.S. § 43-1083.0404/11/201407/24/201412/31/2025
H.B. 252805/10/201712/31/2017