Renewable Energy Equipment Accelerated Depreciation (Minnesota)
Last modified on May 23, 2011.
Financial Incentive Program
|Name||Renewable Energy Equipment Accelerated Depreciation|
|Incentive Type||Corporate Depreciation|
|Applicable Sector||Commercial, Industrial|
|Eligible Technologies||Passive Solar Space Heat, Solar Water Heat, Solar Space Heat, Photovoltaics, Wind|
|Energy Category||Renewable Energy Incentive Programs|
|Program Administrator||Minnesota Department of Commerce|
Minnesota is the only state with accelerated depreciation provisions for renewable energy systems. Minnesota’s incentive mirrors the federal modified accelerated cost recovery schedule (MACRS) for renewables. That is, a five year, 200% declining balance accounting method. The federal code it mirrors is titled "Accelerated Cost Recovery System" and is located in the U.S. tax code in Title 26, Subtitle A, Chapter 1, Subchapter B, Part VI, Section 168.
It was estimated by one analyst that a company installing a qualified system would realize a net project cost reduction over the first three years of 6% due to the state program and an additional 25% due to the federal program. The difference in impact is because Minnesota’s corporate tax rates are lower than U.S. corporate tax rates. Minnesota’s accelerated depreciation allowance has not yet had a significant impact on generation of solar or wind projects, primarily because it has lacked formal publicity.
|Contact Name||Energy Information Center|
|Department||Minnesota Department of Commerce|
|Division||Office of Energy Security|
|Address||85 7th Place East, Suite 500|
|Place||St. Paul, Minnesota|
|Phone 2||(800) 657-3710|
- Incentive and policy data are reviewed and approved by the N.C. Solar Center's DSIRE project staff.