272.029 WIND ENERGY PRODUCTION TAX.
Subdivision 1. Production tax.
A tax is imposed on the production of electricity from a wind
energy conversion system installed after January 1, 1991, and used as an electric power source.
Subd. 2. Definitions.
(a) For the purposes of this section, the term:
(1) "wind energy conversion system" has the meaning given in section
19, and also includes a substation that is used and owned by one or more wind energy conversion
(2) "large scale wind energy conversion system" means a wind energy conversion system of
more than 12 megawatts, as measured by the nameplate capacity of the system or as combined
with other systems as provided in paragraph (b);
(3) "medium scale wind energy conversion system" means a wind energy conversion system
of over two and not more than 12 megawatts, as measured by the nameplate capacity of the
system or as combined with other systems as provided in paragraph (b); and
(4) "small scale wind energy conversion system" means a wind energy conversion system of
two megawatts and under, as measured by the nameplate capacity of the system or as combined
with other systems as provided in paragraph (b).
(b) For systems installed and contracted for after January 1, 2002, the total size of a wind
energy conversion system under this subdivision shall be determined according to this paragraph.
Unless the systems are interconnected with different distribution systems, the nameplate capacity
of one wind energy conversion system shall be combined with the nameplate capacity of any
other wind energy conversion system that is:
(1) located within five miles of the wind energy conversion system;
(2) constructed within the same calendar year as the wind energy conversion system; and
(3) under common ownership.
In the case of a dispute, the commissioner of commerce shall determine the total size of the
system, and shall draw all reasonable inferences in favor of combining the systems.
(c) In making a determination under paragraph (b), the commissioner of commerce
may determine that two wind energy conversion systems are under common ownership when
the underlying ownership structure contains similar persons or entities, even if the ownership
shares differ between the two systems. Wind energy conversion systems are not under common
ownership solely because the same person or entity provided equity financing for the systems.
Subd. 3. Rate of tax.
(a) The owner of a wind energy conversion system shall pay a tax
based on the following schedule:
(1) for a large scale wind energy conversion system, .12 cents per kilowatt-hour of electricity
produced by the system;
(2) for a medium scale wind energy conversion system, .036 cents per kilowatt-hour of
electricity produced by the system; and
(3) for a small scale wind energy conversion system of two megawatts or less, but greater
than .25 megawatts capacity, .012 cents per kilowatt-hour of electricity produced by the system.
(b) Small scale wind energy conversion systems with the capacity of .25 megawatts or less,
and small scale wind energy conversion systems with a capacity of two megawatts or less that are
owned by a political subdivision, are exempt from the wind energy production tax.
Subd. 4. Reports.
(a) An owner of a wind energy conversion system subject to tax under
subdivision 3 shall file a report with the commissioner of revenue annually on or before February
1 detailing the amount of electricity in kilowatt-hours that was produced by the wind energy
conversion system for the previous calendar year. The commissioner shall prescribe the form of
the report. The report must contain the information required by the commissioner to determine
the tax due to each county under this section for the current year. If an owner of a wind energy
conversion system subject to taxation under this section fails to file the report by the due date, the
commissioner of revenue shall determine the tax based upon the nameplate capacity of the system
multiplied by a capacity factor of 40 percent.
(b) On or before February 28, the commissioner of revenue shall notify the owner of the
wind energy conversion systems of the tax due to each county for the current year and shall
certify to the county auditor of each county in which the systems are located the tax due from
each owner for the current year.
Subd. 5. Payment of tax; collection.
The amount of production tax determined under
subdivision 4 must be paid to the county treasurer at the time and in the manner provided for
payment of property taxes under section
277.01, subdivision 3
, and, if unpaid, is subject to the
same enforcement, collection, and interest and penalties as delinquent personal property taxes.
Except to the extent inconsistent with this section, the provisions of sections
apply to the taxes imposed under this section, and for purposes of those
provisions, the taxes imposed under this section are considered personal property taxes.
Subd. 6. Distribution of revenues.
Revenues from the taxes imposed under subdivision
5 must be part of the settlement between the county treasurer and the county auditor under
. The revenue must be distributed by the county auditor or the county treasurer
to local taxing jurisdictions in which the wind energy conversion system is located as follows:
beginning with distributions in 2006, 80 percent to counties; 14 percent to cities and townships;
and six percent to school districts; and for distributions occurring in 2004 and 2005 in the same
proportion that each of the local taxing jurisdiction's current year's net tax capacity based tax rate
is to the current year's total local net tax capacity based rate.
Subd. 6a. Report to commissioner of education.
The county auditor, on the first Wednesday
after such settlement, shall report to the commissioner the amount distributed to each school
district under subdivision 6.
Subd. 7. Exemption.
The tax imposed under this section does not apply to electricity
produced by wind energy conversion systems located in a job opportunity building zone,
designated under section
, for the duration of the zone. The exemption applies beginning
for the first calendar year after designation of the zone and applies to each calendar year that
begins during the designation of the zone.
History: 2002 c 377 art 4 s 13; 1Sp2003 c 21 art 1 s 2; 2005 c 151 art 5 s 14,15; 2006 c
259 art 4 s 10; 2007 c 146 art 1 s 20
Subdivision 6a, as added by Laws 2007, chapter 146, article 1, section 20, is
effective July 1, 2008, for settlements made during fiscal year 2009. Laws 2007, chapter 146,
article 1, section 20, the effective date.