To help New York reach its 50 percent renewable energy by 2030 goal and make it easier for solar developers and end users to finance larger solar projects, like community solar projects in the state, the New York State Energy Research and Development Authority (NYSERDA) developed a Solar PILOT Toolkit. The toolkit is designed to help municipalities understand and negotiate payment-in-lieu-of taxes (PILOT) agreements for solar projects over 1 megawatt in size.
The state’s Real Property Tax Law exempts renewable energy projects from property taxes for 15 years. However, municipalities can also opt-out of the exemption, allowing the systems for taxable. For those that opt of the exemption, they can use a PILOT agreement as an alternative to property taxes on solar projects.
NYSERDA observed that through payments PILOT agreements can create revenues for municipalities when used to finance community solar projects. That’s addition to their job-creation benefits and the clean energy they provide. But the mechanism isn’t well-used yet.
The toolkit discusses property tax issues with regards to solar development. It’s designed to help developers, cities and towns negotiate PILOT rates to make the projects attractive to developers and customers, without making potential solar projects unpalatable.
“The Solar PILOT Toolkit will serve as a vital resource to help municipalities encourage the development of community solar projects and make sure they benefit the entire community,” said Alicia Barton, CEO of NYSERDA. “Large-scale solar projects provide a great opportunity for communities across the state to take advantage of clean, renewable energy while advancing Governor Cuomo’s Reforming the Energy Vision strategy.”
The toolkit has three parts, an example to guide municipalities in exercising legal authority to adopt a PILOT, a sample agreement municipalities can use as a basis to draft a developer agreement and a PILOT calculator that offers guidance on revenue collection under such offerings. The tool was developed based on feedback from local governments and solar industry representatives.Tweet