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Illinois

Illinois

Incentives/Policies for Renewables & Efficiency

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Commercial Wind Energy Property Valuation   

Last DSIRE Review: 04/17/2013
Program Overview:
State: Illinois
Incentive Type: Property Tax Incentive
Eligible Renewable/Other Technologies: Wind
Applicable Sectors: Commercial, Industrial, Utility
Amount:Valuation: $360,000/MW (annually adjusted for inflation) for commercial wind devices larger than 500 kW
Depreciation: Up to 70% of the trended real property cost basis
Start Date:2007 Assessment Year
Expiration Date:2016 Assessment Year
Web Site: http://www.revenue.state.il.us/LocalGovernment/PropertyTax/winden...
Authority 1:
Date Enacted:
Date Effective:
Expiration Date:
ยง 35 ILCS 200/10-600 et seq.
10/17/2007
2007 Assessment Year
2016 Assessment Year
Summary:

Prior to 2007, wind energy devices generating electricity for commercial sale were assessed differently depending on where they were located. Some counties valued the entire turbine structure (tower plus generation equipment) as "real property", subject to taxation, while others deemed only the tower portion as taxable property. This difference in valuation procedure meant that the taxable value of identical wind turbines could vary by as much as 75% from county to county, creating dramatically different tax loads and complicating projects that cross county lines.

In October 2007 Illinois passed Public Act 095-0644, a law providing consistent valuation procedures for commercial wind farm equipment (amended via HB4797 in 2010). For ten years, beginning in the 2007 assessment year, wind energy devices larger than 500 kilowatts (kW) and producing power for commercial sale will be valued at $360,000/Megawatt (MW) of capacity, annually adjusted for inflation according to the U.S. Consumer Price Index. This figure is termed the trended real property cost basis. Because Illinois assesses property for property tax purposes at 1/3 of its fair cash value, in practice the assessed value of commercial wind energy property is $119,988/MW.

The law also defines an allowance for physical depreciation of the device, calculated by dividing the age of the turbine by 25 and then multiplying the result by the trended real property cost basis. The physical depreciation allowance may not exceed 70% of the trended real property cost basis, though additional depreciation allowances may be granted for functional or external obsolescence.


 
Contact:
  Public Information
Illinois Department of Revenue
Willard Ice Building
101 West Jefferson Street
Springfield, IL 62702
Phone: (800) 732-8866
Phone 2: (217) 782-3336
Web Site: http://www.revenue.state.il.us
 
  Kara Moretto
Illinois Department of Revenue
Local Government Services Bureau
Willard Ice Building
101 West Jefferson Street
Springfield, IL 62702
Phone: (800) 732-8866
E-Mail: kara.moretto@illinois.gov
Web Site: http://www.revenue.state.il.us
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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 2013 - 2014 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.