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Incentives/Policies for Renewables & Efficiency

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Energy Replacement Generation Tax Exemption   

Last DSIRE Review: 08/15/2014
Program Overview:
State: Iowa
Incentive Type: Corporate Exemption
Eligible Renewable/Other Technologies: Landfill Gas, Wind, Hydroelectric, Self-generators
Applicable Sectors: Commercial, Industrial, Residential, Local Government
Amount:100% exemption for self-generators, landfill gas and wind
Reduced rate for large hydro
Maximum Incentive:None
Start Date:01/01/2008 (retroactively effective)
Authority 1:
Date Enacted:
Iowa Code § 437A.6
Authority 2:
Iowa Code § 437A.3(27)

Iowa imposes a replacement generation tax of $0.0006 per kilowatt-hour (kWh) on various forms of electricity generated within the state. This tax is imposed in lieu of a property tax on generation facilities.

Under the Energy Replacement Generation Tax Exemption, the following facilities are exempt from the replacement tax:

  • All energy generated by methane gas conversion property to the extent the property is used in connection or conjunction with a publicly-owned sanitary landfill or used to collect waste that would otherwise be collected by or deposited with a publicly-owned sanitary landfill,
  • Wind energy conversion property that is eligible for a tax credit or that is subject to the special valuation of wind energy conversion property, and
  • Self-generators with on-site facilities. In order to qualify for the exemption, self -generators must wholly own or lease the facility in question and produce electricity solely for their own consumption, except for inadvertent unscheduled deliveries to their electric utility. However, facilities that do not consume all energy on-site are not required to pay the replacement tax on energy that is used to operate the facility.

In addition, large hydroelectric generators (100 megawatt or more) pay a reduced generation tax equivalent to $0.000001847 per kWh.

  Public Information - Revenue
Iowa Department of Revenue
Hoover State Office Building
1305 E. Walnut
Des Moines, IA 50319
Phone: (800) 367-3388
Phone 2: (515) 281-3114
Fax: (515) 242-6487
Web Site:
NCSU - home
Disclaimer: The information presented on the DSIRE web site provides an unofficial overview of financial incentives and other policies. It does not constitute professional tax advice or other professional financial guidance, and it should not be used as the only source of information when making purchasing decisions, investment decisions or tax decisions, or when executing other binding agreements. Please refer to the individual contact provided below each summary to verify that a specific financial incentive or other policy applies to your project.

While the DSIRE staff strives to provide the best information possible, the DSIRE staff, the N.C. Solar Center, N.C. State University and the Interstate Renewable Energy Council, Inc. make no representations or warranties, either express or implied, concerning the accuracy, completeness, reliability or suitability of the information. The DSIRE staff, the N.C. Solar Center, N.C. State University and the Interstate Renewable Energy Council, Inc. disclaim all liability of any kind arising out of your use or misuse of the information contained or referenced on DSIRE Web pages.

Copyright 2014 - 2015 North Carolina State University, under NREL Subcontract No. XEU-0-99515-01. Permission granted only for personal or educational use, or for use by or on behalf of the U.S. government. North Carolina State University prohibits the unauthorized display, reproduction, sale, and/or distribution of all or portions of the content of the Database of State Incentives for Renewables and Efficiency (DSIRE) without prior, written consent.