Regulation - Minister
Property Tax Treatment of Renewable Energy Installations
Regulation Number(s):
Ontario Regulation 282/98
Ontario Regulation 1/12
Ontario Regulation 1/12
Instrument Type:
Regulation - Minister
Bill or Act:
Assessment Act
Summary of Decision:
The Assessment Act Regulation 1/12 was approved by the Minister and Filed on January 4, 2012.
Further Information:
Property Tax Treatment of Renewable Energy Installations
(Download Adobe Reader)
Ontario Regulation 1/12
Assessment Act
Proposal Number:
11-MOF021
Posting Date:
August 2, 2011
Summary of Proposal:
The objective of the proposed regulatory amendments is to provide greater clarity and certainty to property owners, energy generators, municipalities and the Municipal Property Assessment Corporation regarding the property tax treatment of renewable energy facilities.
The amendments would build upon the existing regulatory framework by creating additional categories based on the size and location of generation. These policies will apply to electricity generation installations that utilize solar, wind or anaerobic digestion technologies.
The proposed new categories are outlined below along with the aspects of the current provisions that will remain in place.
ROOFTOP INSTALLATIONS:
The assessment and tax classification of property would not change due to the addition of a rooftop energy generation installation.
GROUND INSTALLATIONS:
For ground-mounted installations, the property tax treatment will depend upon the size of the facility as well as the entity who is doing the generation.
Generation as Ancillary Activity - Not by a Corporate Power Producer -
The following rules would apply where generation is conducted by a person who is not ordinarily in the business of electricity generation, transmission or distribution, and where the generation is secondary to the main activity on the property.
Small-size ground installations, with generation capacity up to 10 kW, would not result in assessment increase or change in tax classification.
Medium-size ground installations, with generation capacity over 10 kW up to 500 kW, would be taxed based on the surrounding land use (e.g. residential, farm, multi-residential, commercial).
Large-size ground installations, with generation capacity over 500 kW, would be taxed based on the surrounding land use for the proportion of assessment up to 500 kW, and at the industrial rate for the proportion over 500 kW.
On-Farm Anaerobic Digestion -
Anaerobic digestion facilities of any size that are located on a farm and operated by the farmer would be taxed at the farm rate.
Generation by Corporate Power Producer -
Consistent with current treatment, ground-based generation facilities operated by entities whose primary business is the generation, transmission or distribution of electricity (corporate power producers) would be taxed at the industrial rate.
Wind Turbine Towers -
Consistent with current treatment, wind turbine towers would continue to be assessed at the rate of $40,000 per MW of installed capacity, except in the two situations noted above where the assessment would not be affected by the installation (rooftop installations and ground-based installations up to 10 kW).
EFFECTIVE DATE:
The regulatory amendments would come into effect for the 2011 tax year.
The amendments would build upon the existing regulatory framework by creating additional categories based on the size and location of generation. These policies will apply to electricity generation installations that utilize solar, wind or anaerobic digestion technologies.
The proposed new categories are outlined below along with the aspects of the current provisions that will remain in place.
ROOFTOP INSTALLATIONS:
The assessment and tax classification of property would not change due to the addition of a rooftop energy generation installation.
GROUND INSTALLATIONS:
For ground-mounted installations, the property tax treatment will depend upon the size of the facility as well as the entity who is doing the generation.
Generation as Ancillary Activity - Not by a Corporate Power Producer -
The following rules would apply where generation is conducted by a person who is not ordinarily in the business of electricity generation, transmission or distribution, and where the generation is secondary to the main activity on the property.
Small-size ground installations, with generation capacity up to 10 kW, would not result in assessment increase or change in tax classification.
Medium-size ground installations, with generation capacity over 10 kW up to 500 kW, would be taxed based on the surrounding land use (e.g. residential, farm, multi-residential, commercial).
Large-size ground installations, with generation capacity over 500 kW, would be taxed based on the surrounding land use for the proportion of assessment up to 500 kW, and at the industrial rate for the proportion over 500 kW.
On-Farm Anaerobic Digestion -
Anaerobic digestion facilities of any size that are located on a farm and operated by the farmer would be taxed at the farm rate.
Generation by Corporate Power Producer -
Consistent with current treatment, ground-based generation facilities operated by entities whose primary business is the generation, transmission or distribution of electricity (corporate power producers) would be taxed at the industrial rate.
Wind Turbine Towers -
Consistent with current treatment, wind turbine towers would continue to be assessed at the rate of $40,000 per MW of installed capacity, except in the two situations noted above where the assessment would not be affected by the installation (rooftop installations and ground-based installations up to 10 kW).
EFFECTIVE DATE:
The regulatory amendments would come into effect for the 2011 tax year.
Contact Address:
777 Bay Street, 10th Floor
Toronto, Ontario
M5G 2C8
Toronto, Ontario
M5G 2C8
Effective Date:
January 1, 2011
Decision:
Approved