Renewable Energy/Solar Sales Tax Exemption

Summary

Nevada law exempts from local sales and use taxes the sale, storage and consumption of any products or systems designed or adapted to use renewable energy to generate electricity and all of its integral components. Included in the exemption are all sources of energy that occur naturally or are regenerated naturally, including biomass (agricultural crops, wastes and residues, wood, wood wastes, and residues, animal wastes, municipal waste and aquatic plants), fuel cells, geothermal energy, solar energy, hydropower and wind. In 2003, SB 489 extended this exemption to solar-thermal energy systems and solar lighting systems and integral parts that reduce the consumption of electricity or any fossil fuel. The state sales tax rate for all products exempt from local sales and use tax is 2% in all counties. In 2005, AB3 further expanded the exemption to include all products or materials used in the construction of a building if the building is certified or will meet the equivalent of LEED Silver in accordance with the Leadership in Energy and Environmental Design (LEED) Green Building Rating System. As of August 2005, the regulations for this addition were under development. Consult the Nevada Department of Taxation for more details. The sales tax exemption is currently set to expire December 31, 2005, but may be extended.