Title 44
Taxation

Chapter 57
Residential Renewable Energy System Tax Credit

§ 44-57-5. Computation of tax credit.

(a) The tax credit on each system as provided for in this chapter shall be determined as follows:

(1) Photovoltaic systems:

(i)(A) Photovoltaic systems shall have a minimum module size of twenty-four (24) square feet; and

(B) Be connected to a battery storage system or be grid interconnected;

(ii) Qualifying systems shall receive a tax credit of:

(A) Twenty-five percent (25%) of the cost of the system.

(iii) The maximum cost of the system shall not exceed fifteen thousand dollars ($15,000); provided, systems costing more than fifteen thousand dollars ($15,000) will receive a tax credit based on a fifteen thousand dollar ($15,000) system cost.

(2) Solar domestic hot water systems:

(i)(A) Solar domestic hot water systems shall have a minimum collector area of thirty-four (34) square feet; and

(B) A solar storage tank that is at least eighty (80) gallons.

(ii) Qualifying systems shall receive a tax credit of:

(A) Twenty-five percent (25%) of the cost of the system.

(iii) The maximum cost of the system shall not exceed seven thousand dollars ($7,000); provided, systems costing more than seven thousand dollars ($7,000) will receive a tax credit based on a seven thousand dollar ($7,000) system cost.

(3) Active solar heating systems:

(i)(A) Active solar space heating systems shall have a minimum collector area of one hundred twenty-five (125) square feet; and

(B) A system for storing and/or distributing the heat to the living area of the house.

(ii) Qualifying systems shall receive a tax credit of:

(A) Twenty-five percent (25%) of the cost of the system.

(iii) The maximum cost of the system shall not exceed fifteen thousand dollars ($15,000); provided, systems costing more than fifteen thousand dollars ($15,000) will receive a tax credit based on a fifteen thousand dollar ($15,000) system cost.

(4) Wind energy systems:

(i)(A) Wind energy systems must have a rotor diameter of at least forty-four inches (44″); and

(B) Have a minimum factory rated output of at least two hundred fifty (250) watts at twenty-eight (28) mph.

(ii) Qualifying systems shall receive a tax credit of:

(A) Twenty-five percent (25%) of the cost of the system.

(iii) The maximum cost of the system shall not exceed fifteen thousand dollars ($15,000); provided, systems costing more than fifteen thousand dollars ($15,000) will receive a tax credit based on a fifteen thousand dollar ($15,000) system cost.

(5) Geothermal systems:

(i) Geothermal systems must have either a coefficient of performance of 3.4 or greater or an efficiency ratio of sixteen (16) or greater. All geothermal systems must have a commissioning sign-off by the manufacturer or distributor of the equipment to verify the proper installation and performance of the system. All geothermal systems must meet the following standards:

(A) ARI/ASHRAE/ISO-13256-1 for water to air geothermal systems;

(B) ARI/ASHRAE/ISO-13256-2 for water to water geothermal systems;

(C) ARI/ASHRAE/ISO-13256 GWHP for groundwater heat pumps;

(D) ARI/ASHRAE/ISO-13256 GLHP for closed loop heat pumps;

(ii) Qualifying systems shall receive a tax credit of:

(A) Twenty-five percent (25%) of the cost of the system.

(iii) The maximum cost of the system shall not exceed seven thousand dollars ($7,000). Provided, systems costing more than seven thousand dollars ($7,000) will receive a tax credit based on a seven thousand dollar ($7,000) system cost.

(b) For purposes of the tax credit, the cost of the renewable energy system shall be the net cost of acquiring the system, and shall not include:

(1) Unpaid labor including the applicant’s labor;

(2) Operating and maintenance costs;

(3) Land costs;

(4) Legal and court costs;

(5) Patent search fees;

(6) Fees for variances;

(7) Loan interest;

(8) Service contracts;

(9) Cost of moving a used renewable energy system from one site to another;

(10) Cost of repair or resale of a system;

(11) Any part of the purchase price that is optional, such as an extended warranty or an upgraded monitoring system; and

(12) Delivery fees.