§ 487 — Exemption from taxation for certain energy systems

New York § 487

• Jurisdiction: New York
• Law RPT: Real Property Tax
• Title 2: Private Property
• Art. 4: Exemptions

Text

§ 487. Exemption from taxation for certain energy systems. 1. As used\nin this section:\n (a) "Solar or wind energy equipment" means collectors, controls,\nenergy storage devices, heat pumps and pumps, heat exchangers,\nwindmills, and other materials, hardware or equipment necessary to the\nprocess by which solar radiation or wind is (i) collected, (ii)\nconverted into another form of energy such as thermal, electrical,\nmechanical or chemical, (iii) stored, (iv) protected from unnecessary\ndissipation and (v) distributed. It does not include pipes, controls,\ninsulation or other equipment which are part of the normal heating,\ncooling, or insulation system of a building. It does include insulated\nglazing or insulation to the extent that such materials exceed the\nenergy efficiency standards required by law.\n (b) "Solar or wind energy system" means an arrangement or combination\nof solar or wind energy equipment designed to provide heating, cooling,\nhot water, or mechanical, chemical, or electrical energy by the\ncollection of solar or wind energy and its conversion, storage,\nprotection and distribution.\n (c) "Authority" means the New York state energy research and\ndevelopment authority.\n (d) "Incremental cost" means the increased cost of a solar or wind\nenergy system or farm waste energy system or component thereof which\nalso serves as part of the building structure, above that for similar\nconventional construction, which enables its use as a solar or wind\nenergy or farm waste energy system or component.\n (e) "Farm waste electric generating equipment" means equipment that\ngenerates electric energy from biogas produced by the anaerobic\ndigestion of agricultural waste, such as livestock manure, farming waste\nand food processing wastes with a rated capacity of not more than one\nthousand kilowatts that is (i) manufactured, installed and operated in\naccordance with applicable government and industry standards, (ii)\nconnected to the electric system and operated in conjunction with an\nelectric corporation's transmission and distribution facilities, (iii)\noperated in compliance with the provisions of section sixty-six-j of the\npublic service law, (iv) fueled at a minimum of ninety percent on an\nannual basis by biogas produced from the anaerobic digestion of\nagricultural waste such as livestock manure materials, crop residues and\nfood processing wastes, and (v) fueled by biogas generated by anaerobic\ndigestion with at least fifty percent by weight of its feedstock being\nlivestock manure materials on an annual basis.\n (f) "Farm waste energy system" means an arrangement or combination of\nfarm waste electric generating equipment or other materials, hardware or\nequipment necessary to the process by which agricultural waste biogas is\nproduced, collected, stored, cleaned, and converted into forms of energy\nsuch as thermal, electrical, mechanical or chemical and by which the\nbiogas and converted energy are distributed on-site. It does not include\npipes, controls, insulation or other equipment which are part of the\nnormal heating, cooling or insulation system of a building.\n (g) "Micro-hydroelectric energy equipment" means any energy storage\ndevice, penstock, turbine, generator and other materials, hardware and\nequipment necessary to the process by which the flow of stream or river\nwater or water from other water bodies is (i) converted into electrical\nenergy; (ii) protected from unnecessary dissipation; and (iii)\ndistributed. It does not include pipes, controls, insulation or other\nequipment which are part of the normal heating, cooling, or insulation\nsystem of a building. It does not include insulated glazing or\ninsulation to the extent that such materials exceed the energy\nefficiency standards established by law.\n (h) "Micro-hydroelectric energy system" means an arrangement or\ncombination of micro-hydroelectric energy equipment designed to provide\nelectrical energy by the use of flowing water. It does not include\npipes, controls, insulation or other equipment which are part of the\nnormal heating, cooling, or insulation system of a building. It does not\ninclude insulated glazing or insulation to the extent that such\nmaterials exceed the energy efficiency standards established by law.\n (i) "Fuel cell electric generating equipment" means a solid oxide,\nmolten carbonate, proton exchange membrane or phosphoric acid fuel cell\nwith a combined rated capacity of not more than two thousand kilowatts.\nIt does not include insulated glazing or insulation to the extent that\nsuch materials exceed the energy efficiency standards established by\nlaw.\n (j) "Fuel cell electric generating system" means an arrangement or\ncombination of equipment designed to produce electrical energy through\nreaction of chemicals, including but not limited to hydrogen, oxygen,\nmethane and natural gas.\n (k) "Micro-combined heat and power generating equipment" means an\nintegrated, cogenerating building heating and electrical power\ngeneration system, owned, leased or operated by a residential customer,\nlocated at such customer's premises, operating on any fuel and of any\napplicable engine, fuel cell, fuel-flexible linear generator or other\ntechnology with a rated capacity of at least one kilowatt and not more\nthan ten kilowatts electric and any thermal output that has a design\ntotal fuel use efficiency in the production of heat and electricity of\nnot less than eighty percent, and annually produces at least two\nthousand kilowatt hours of useful energy in the form of electricity that\nmay work in combination with supplemental or parallel conventional\nheating systems, that is manufactured, installed and operated in\naccordance with applicable government and industry standards, that is\nconnected to the electric system and operated in conjunction with an\nelectric corporation's transmission and distribution facilities. It does\nnot include pipes, controls, insulation or other equipment which are\npart of the normal heating, cooling, or insulation system of a building.\nIt does not include insulated glazing or insulation to the extent that\nsuch materials exceed the energy efficiency standards established by\nlaw.\n (l) "Micro-combined heat and power generating equipment system" means\nan arrangement or combination of equipment designed to produce\nelectrical energy and heat for a residential customer on such customer's\npremises.\n (m) "Electric energy storage equipment" means a set of technologies\ncapable of storing electric energy and releasing that energy as electric\npower at a later time. Electric energy storage technologies may store\nenergy as potential, kinetic, chemical or thermal energy, that can be\nreleased as electric power and include, but are not limited to, various\ntypes of batteries, flywheels, electrochemical capacitors, compressed\nair storage and thermal storage devices.\n (n) "Electric energy storage system" means an arrangement or\ncombination of equipment designed to store electrical energy in electric\nenergy storage equipment and release electric power at a later time.\n (o) "Fuel-flexible linear generator electric generating equipment" or\n"fuel-flexible linear generator" means an integrated system consisting\nof oscillators, cylinders, electricity conversion equipment and\nassociated balance of plant components that directly convert the linear\nmotion of the oscillators into electricity and which has a combined\nrated capacity of not more than two thousand kilowatts.\n (p) "Fuel-flexible linear generator electric generating system" means\nan arrangement or combination of fuel-flexible linear generator electric\ngenerating equipment designed to produce electrical energy from linear\nmotion created by the reaction of gaseous or liquid fuels, including but\nnot limited to biogas and natural gas.\n 2. Real property which includes a solar or wind energy system, farm\nwaste energy system, micro-hydroelectric energy system, fuel cell\nelectric generating system, micro-combined heat and power generating\nequipment system, electric energy storage equipment and electric energy\nstorage system, or fuel-flexible linear generator electric generating\nsystem approved in accordance with the provisions of this section shall\nbe exempt from taxation to the extent of any increase in the value\nthereof by reason of the inclusion of such solar or wind energy system,\nfarm waste energy system, micro-hydroelectric energy system, fuel cell\nelectric generating system, micro-combined heat and power generating\nequipment system, electric energy storage equipment and electric energy\nstorage system, or fuel-flexible linear generator electronic generating\nsystem for a period of fifteen years. When a solar or wind energy system\nor components thereof, farm waste energy system, micro-hydroelectric\nenergy system, fuel cell electric generating system, micro-combined heat\nand power generating equipment system, electric energy storage equipment\nand electric energy storage system, or fuel-flexible linear generator\nelectronic generating system also serve as part of the building\nstructure, the increase in value which shall be exempt from taxation\nshall be equal to the assessed value attributable to such system or\ncomponents multiplied by the ratio of the incremental cost of such\nsystem or components to the total cost of such system or components. The\nexemption provided by this section is inapplicable to any structure that\nsatisfies the requirements for exemption under section four hundred\neighty-three-e of this title.\n 3. The president of the authority shall provide definitions and\nguidelines for the eligibility for exemption of the solar and wind\nenergy equipment and systems, farm waste energy equipment and systems,\nmicro-hydroelectric equipment and systems, fuel cell electric generating\nequipment and systems, micro-combined heat and power generating\nequipment and systems, electric energy storage equipment and electric\nenergy storage system, and fuel-flexible linear generator electric\ngenerating equipment and systems described in paragraphs (a), (b), (e),\n(f), (g), (h), (i), (j), (k), (l), (m), (n), (o) and (p) of subdivision\none of this section.\n 4. No solar or wind energy system, farm waste energy system,\nmicro-hydroelectric energy system, fuel cell electric generating system,\nmicro-combined heat and power generating equipment system, electric\nenergy storage equipment and electric energy storage system, or\nfuel-flexible linear generator electric generating system shall be\nentitled to any exemption from taxation under this section unless such\nsystem meets the guidelines set by the president of the authority and\nall other applicable provisions of law.\n 5. The exemption granted pursuant to this section shall only be\napplicable to (a) solar or wind energy systems or farm waste energy\nsystems which are (i) existing or constructed prior to July first,\nnineteen hundred eighty-eight or (ii) constructed subsequent to January\nfirst, nineteen hundred ninety-one and prior to January first, two\nthousand thirty, and (b) micro-hydroelectric energy systems, fuel cell\nelectric generating systems, micro-combined heat and power generating\nequipment systems, electric energy storage equipment or electric energy\nstorage system, or fuel-flexible linear generator electric generating\nsystem which are constructed subsequent to January first, two thousand\neighteen and prior to January first, two thousand thirty.\n 6. Such exemption shall be granted only upon application by the owner\nof the real property on a form prescribed and made available by the\ncommissioner in cooperation with the authority. The applicant shall\nfurnish such information as the commissioner shall require. The\napplication shall be filed with the assessor of the appropriate county,\ncity, town or village on or before the taxable status date of such\ncounty, city, town or village. A copy of such application shall be filed\nwith the authority.\n 7. If the assessor is satisfied that the applicant is entitled to an\nexemption pursuant to this section, he or she shall approve the\napplication and enter the taxable assessed value of the parcel for which\nan exemption has been granted pursuant to this section on the assessment\nroll with the taxable property, with the amount of the exemption set\nforth in a separate column as computed pursuant to subdivision two of\nthis section in a separate column. In the event that real property\ngranted an exemption pursuant to this section ceases to be used\nprimarily for eligible purposes, the exemption granted pursuant to this\nsection shall cease.\n 8. (a) Notwithstanding the provisions of subdivision two of this\nsection, a county, city, town or village may by local law or a school\ndistrict, other than a school district to which article fifty-two of the\neducation law applies, may by resolution provide either (i) that no\nexemption under this section shall be applicable within its jurisdiction\nwith respect to any solar or wind energy system or farm waste energy\nsystem which began construction subsequent to January first, nineteen\nhundred ninety-one or the effective date of such local law, ordinance or\nresolution, whichever is later, and/or (ii) that no exemption under this\nsection shall be applicable within its jurisdiction with respect to any\nmicro-hydroelectric energy system, fuel cell electric generating system,\nmicro-combined heat and power generating equipment system, electric\nenergy storage equipment or electric energy storage system, or\nfuel-flexible linear generator electric generating system constructed\nsubsequent to January first, two thousand eighteen or the effective date\nof such local law, ordinance or resolution, whichever is later. A copy\nof any such local law or resolution shall be filed with the commissioner\nand with the president of the authority.\n (b) Construction of a solar or wind energy system or a farm waste\nenergy system shall be deemed to have begun upon the full execution of a\ncontract or interconnection agreement with a utility; provided however,\nthat if such contract or interconnection agreement requires a deposit to\nbe made, then construction shall be deemed to have begun when the\ncontract or interconnection agreement is fully executed and the deposit\nis made. The owner or developer of such a system shall provide written\nnotification to the appropriate local jurisdiction or jurisdictions upon\nexecution of the contract or the interconnection agreement.\n 9. (a) A county, city, town, village or school district, except a\nschool district under article fifty-two of the education law, that has\nnot acted to remove the exemption under this section may require the\nowner of a property which includes a solar or wind energy system which\nmeets the requirements of subdivision four of this section, to enter\ninto a contract for payments in lieu of taxes. Such contract may require\nannual payments in an amount not to exceed the amounts which would\notherwise be payable but for the exemption under this section. If the\nowner or developer of such a system provides written notification to a\ntaxing jurisdiction of its intent to construct such a system, then in\norder to require the owner or developer of such system to enter into a\ncontract for payments in lieu of taxes, such taxing jurisdiction must\nnotify such owner or developer in writing of its intent to require a\ncontract for payments in lieu of taxes within sixty days of receiving\nthe written notification. Written notification to a taxing jurisdiction\nfor this purpose shall include a hard copy letter sent to the\nhighest-ranking official of the taxing jurisdiction. Such letter shall\nexplicitly reference subdivision nine of section four hundred\neighty-seven of the real property tax law, and clearly state that,\nunless the taxing jurisdiction responds within sixty days in writing\nwith its intent to require a contract for payments in lieu of taxes,\nsuch project shall not be obligated to make such payments.\n (b) Notwithstanding paragraph (a) of this subdivision, should a taxing\njurisdiction adopt a law or resolution at any time within or prior to\nthe sixty day window, indicating the taxing jurisdiction's ongoing\nintent to require a contract for payments in lieu of taxes for such\nsystems, such law or resolution shall be considered notification to\nowners or developers and no further action is required on the part of\nthe taxing jurisdiction, provided that such law or resolution remains in\neffect through the end of the sixty day notification period.\n (c) Any payment in lieu of a tax agreement shall not operate for a\nperiod of more than fifteen years, commencing in each instance from the\ndate on which the benefits of such exemption first become available and\neffective.\n 10. Notwithstanding the foregoing provisions of this section, on or\nafter April first, two thousand nineteen, a county, city, town or\nvillage may by local law or a school district, other than a school\ndistrict to which article fifty-two of the education law applies, may by\nresolution provide that real property that comprises or includes a solar\nor wind energy system, farm waste energy system, microhydroelectric\nenergy system, fuel cell electric generating system, microcombined heat\nand power generating equipment system, electric energy storage system,\nor fuel-flexible linear generator as such terms are defined in\nparagraphs (b), (f), (h), (j), (l), (n), and (o) of subdivision one of\nthis section (hereinafter, individually or collectively, "energy\nsystem"), shall be permanently exempt from any taxation, special ad\nvalorem levies, and special assessments to the extent provided in\nsection four hundred ninety of this article, and the owner of such\nproperty shall not be subject to any requirement to enter into a\ncontract for payments in lieu of taxes in accordance with subdivision\nnine of this section, if: (a) the energy system is installed on real\nproperty that is owned or controlled by the state of New York, a\ndepartment or agency thereof, or a state authority as that term is\ndefined by subdivision one of section two of the public authorities law;\nand (b) the state of New York, a department or agency thereof, or a\nstate authority as that term is defined by subdivision one of section\ntwo of the public authorities law has agreed to purchase the energy\nproduced by such energy system or the environmental credits or\nattributes created by virtue of the energy system's operation, in\naccordance with a written agreement with the owner or operator of such\nenergy system. Such exemption shall be granted only upon application by\nthe owner of the real property on a form prescribed by the commissioner,\nwhich application shall be filed with the assessor of the appropriate\ncounty, city, town or village on or before the taxable status date of\nsuch county, city, town or village.\n