2023 New York Laws › RPT - Real Property Tax › Article 4 - Exemptions › Title 2 - Private Property › 487 - Exemption From Taxation for Certain Energy Systems.

§ 487. Exemption from taxation for certain energy systems.  1. As used
in this section:
(a)  "Solar  or  wind  energy  equipment"  means collectors, controls,
energy  storage  devices,  heat  pumps  and  pumps,   heat   exchangers,
windmills,  and  other materials, hardware or equipment necessary to the
process by  which  solar  radiation  or  wind  is  (i)  collected,  (ii)
converted  into  another  form  of  energy  such as thermal, electrical,
mechanical or chemical, (iii) stored, (iv)  protected  from  unnecessary
dissipation  and  (v)  distributed. It does not include pipes, controls,
insulation or other equipment which are  part  of  the  normal  heating,
cooling,  or  insulation system of a building. It does include insulated
glazing or insulation to the  extent  that  such  materials  exceed  the
energy efficiency standards required by law.
(b)  "Solar or wind energy system" means an arrangement or combination
of solar or wind energy equipment designed to provide heating,  cooling,
hot  water,  or  mechanical,  chemical,  or  electrical  energy  by  the
collection  of  solar  or  wind  energy  and  its  conversion,  storage,
protection and distribution.
(c)   "Authority"  means  the  New  York  state  energy  research  and
development authority.
(d) "Incremental cost" means the increased cost of  a  solar  or  wind
energy  system  or  farm  waste energy system or component thereof which
also serves as part of the building structure, above  that  for  similar
conventional  construction,  which  enables  its  use as a solar or wind
energy or farm waste energy system or component.
(e) "Farm waste electric generating equipment"  means  equipment  that
generates   electric  energy  from  biogas  produced  by  the  anaerobic
digestion of agricultural waste, such as livestock manure, farming waste
and food processing wastes with a rated capacity of not  more  than  one
thousand  kilowatts  that is (i) manufactured, installed and operated in
accordance with  applicable  government  and  industry  standards,  (ii)
connected  to  the  electric  system and operated in conjunction with an
electric corporation's transmission and distribution  facilities,  (iii)
operated in compliance with the provisions of section sixty-six-j of the
public  service  law,  (iv)  fueled at a minimum of ninety percent on an
annual  basis  by  biogas  produced  from  the  anaerobic  digestion  of
agricultural waste such as livestock manure materials, crop residues and
food  processing wastes, and (v) fueled by biogas generated by anaerobic
digestion with at least fifty percent by weight of its  feedstock  being
livestock manure materials on an annual basis.
(f)  "Farm waste energy system" means an arrangement or combination of
farm waste electric generating equipment or other materials, hardware or
equipment necessary to the process by which agricultural waste biogas is
produced, collected, stored, cleaned, and converted into forms of energy
such as thermal, electrical, mechanical or chemical  and  by  which  the
biogas and converted energy are distributed on-site. It does not include
pipes,  controls,  insulation  or  other equipment which are part of the
normal heating, cooling or insulation system of a building.
(g) "Micro-hydroelectric energy equipment" means  any  energy  storage
device,  penstock,  turbine, generator and other materials, hardware and
equipment necessary to the process by which the flow of stream or  river
water  or water from other water bodies is (i) converted into electrical
energy;  (ii)  protected  from  unnecessary   dissipation;   and   (iii)
distributed.  It  does  not include pipes, controls, insulation or other
equipment which are part of the normal heating, cooling,  or  insulation
system  of  a  building.  It  does  not  include  insulated  glazing  or
insulation  to  the  extent  that  such  materials  exceed  the   energy
efficiency standards established by law.
(h)  "Micro-hydroelectric  energy  system"  means  an  arrangement  or
combination of micro-hydroelectric energy equipment designed to  provide
electrical  energy  by  the  use  of  flowing water. It does not include
pipes, controls, insulation or other equipment which  are  part  of  the
normal heating, cooling, or insulation system of a building. It does not
include  insulated  glazing  or  insulation  to  the  extent  that  such
materials exceed the energy efficiency standards established by law.
(i) "Fuel cell electric generating equipment"  means  a  solid  oxide,
molten  carbonate, proton exchange membrane or phosphoric acid fuel cell
with a combined rated capacity of not more than two thousand  kilowatts.
It  does  not include insulated glazing or insulation to the extent that
such materials exceed the energy  efficiency  standards  established  by
law.
(j)  "Fuel  cell  electric  generating system" means an arrangement or
combination of equipment designed to produce electrical  energy  through
reaction  of  chemicals,  including but not limited to hydrogen, oxygen,
methane and natural gas.
(k) "Micro-combined heat and  power  generating  equipment"  means  an
integrated,   cogenerating   building   heating   and  electrical  power
generation system, owned, leased or operated by a residential  customer,
located  at  such  customer's premises, operating on any fuel and of any
applicable engine, fuel cell, fuel-flexible linear  generator  or  other
technology  with  a rated capacity of at least one kilowatt and not more
than ten kilowatts electric and any thermal output  that  has  a  design
total  fuel  use efficiency in the production of heat and electricity of
not less than  eighty  percent,  and  annually  produces  at  least  two
thousand kilowatt hours of useful energy in the form of electricity that
may  work  in  combination  with  supplemental  or parallel conventional
heating  systems,  that  is  manufactured,  installed  and  operated  in
accordance  with  applicable  government and industry standards, that is
connected to the electric system and operated  in  conjunction  with  an
electric corporation's transmission and distribution facilities. It does
not  include  pipes,  controls,  insulation or other equipment which are
part of the normal heating, cooling, or insulation system of a building.
It does not include insulated glazing or insulation to the  extent  that
such  materials  exceed  the  energy efficiency standards established by
law.
(l) "Micro-combined heat and power generating equipment system"  means
an   arrangement   or  combination  of  equipment  designed  to  produce
electrical energy and heat for a residential customer on such customer's
premises.
(m) "Electric energy storage equipment" means a  set  of  technologies
capable of storing electric energy and releasing that energy as electric
power  at  a  later time. Electric energy storage technologies may store
energy as potential, kinetic, chemical or thermal energy,  that  can  be
released  as electric power and include, but are not limited to, various
types of batteries, flywheels,  electrochemical  capacitors,  compressed
air storage and thermal storage devices.
(n)   "Electric   energy  storage  system"  means  an  arrangement  or
combination of equipment designed to store electrical energy in electric
energy storage equipment and release electric power at a later time.
(o) "Fuel-flexible linear generator electric generating equipment"  or
"fuel-flexible  linear  generator" means an integrated system consisting
of  oscillators,  cylinders,  electricity   conversion   equipment   and
associated  balance of plant components that directly convert the linear
motion of the oscillators into electricity  and  which  has  a  combined
rated capacity of not more than two thousand kilowatts.
(p)  "Fuel-flexible linear generator electric generating system" means
an arrangement or combination of fuel-flexible linear generator electric
generating equipment designed to produce electrical energy  from  linear
motion created by the reaction of gaseous or liquid fuels, including but
not limited to biogas and natural gas.
2.  Real  property  which includes a solar or wind energy system, farm
waste  energy  system,  micro-hydroelectric  energy  system,  fuel  cell
electric  generating  system,  micro-combined  heat and power generating
equipment system, electric energy storage equipment and electric  energy
storage  system,  or  fuel-flexible linear generator electric generating
system approved in accordance with the provisions of this section  shall
be  exempt  from  taxation  to  the  extent of any increase in the value
thereof by reason of the inclusion of such solar or wind energy  system,
farm  waste  energy system, micro-hydroelectric energy system, fuel cell
electric generating system, micro-combined  heat  and  power  generating
equipment  system, electric energy storage equipment and electric energy
storage system, or fuel-flexible linear generator electronic  generating
system for a period of fifteen years. When a solar or wind energy system
or  components  thereof,  farm  waste energy system, micro-hydroelectric
energy system, fuel cell electric generating system, micro-combined heat
and power generating equipment system, electric energy storage equipment
and electric energy storage system, or  fuel-flexible  linear  generator
electronic  generating  system  also  serve  as  part  of  the  building
structure, the increase in value which shall  be  exempt  from  taxation
shall  be  equal  to  the  assessed value attributable to such system or
components multiplied by the ratio  of  the  incremental  cost  of  such
system or components to the total cost of such system or components. The
exemption provided by this section is inapplicable to any structure that
satisfies  the  requirements  for  exemption  under section four hundred
eighty-three-e of this title.
3. The president  of  the  authority  shall  provide  definitions  and
guidelines  for  the  eligibility  for  exemption  of the solar and wind
energy equipment and systems, farm waste energy equipment  and  systems,
micro-hydroelectric equipment and systems, fuel cell electric generating
equipment   and   systems,  micro-combined  heat  and  power  generating
equipment and systems, electric energy storage  equipment  and  electric
energy  storage  system,  and  fuel-flexible  linear  generator electric
generating equipment and systems described in paragraphs (a), (b),  (e),
(f),  (g), (h), (i), (j), (k), (l), (m), (n), (o) and (p) of subdivision
one of this section.
4.  No  solar  or  wind  energy  system,  farm  waste  energy  system,
micro-hydroelectric energy system, fuel cell electric generating system,
micro-combined  heat  and  power  generating  equipment system, electric
energy  storage  equipment  and  electric  energy  storage  system,   or
fuel-flexible  linear  generator  electric  generating  system  shall be
entitled to any exemption from taxation under this section  unless  such
system  meets  the  guidelines set by the president of the authority and
all other applicable provisions of law.
5. The exemption granted  pursuant  to  this  section  shall  only  be
applicable  to  (a)  solar  or  wind energy systems or farm waste energy
systems which are (i) existing  or  constructed  prior  to  July  first,
nineteen  hundred eighty-eight or (ii) constructed subsequent to January
first, nineteen hundred ninety-one  and  prior  to  January  first,  two
thousand  thirty,  and (b) micro-hydroelectric energy systems, fuel cell
electric generating systems, micro-combined heat  and  power  generating
equipment  systems, electric energy storage equipment or electric energy
storage system, or fuel-flexible linear  generator  electric  generating

system  which  are constructed subsequent to January first, two thousand
eighteen and prior to January first, two thousand thirty.
6.  Such exemption shall be granted only upon application by the owner
of the real property on a form prescribed  and  made  available  by  the
commissioner  in  cooperation  with  the  authority. The applicant shall
furnish  such  information  as  the  commissioner  shall  require.   The
application  shall be filed with the assessor of the appropriate county,
city, town or village on or before  the  taxable  status  date  of  such
county, city, town or village. A copy of such application shall be filed
with the authority.
7.  If  the assessor is satisfied that the applicant is entitled to an
exemption pursuant  to  this  section,  he  or  she  shall  approve  the
application and enter the taxable assessed value of the parcel for which
an exemption has been granted pursuant to this section on the assessment
roll  with  the  taxable  property, with the amount of the exemption set
forth in a separate column as computed pursuant to  subdivision  two  of
this  section  in  a  separate  column.  In the event that real property
granted an  exemption  pursuant  to  this  section  ceases  to  be  used
primarily  for eligible purposes, the exemption granted pursuant to this
section shall cease.
8. (a) Notwithstanding the  provisions  of  subdivision  two  of  this
section,  a  county,  city, town or village may by local law or a school
district, other than a school district to which article fifty-two of the
education law applies, may by resolution  provide  either  (i)  that  no
exemption under this section shall be applicable within its jurisdiction
with  respect  to  any  solar or wind energy system or farm waste energy
system which began construction subsequent to  January  first,  nineteen
hundred ninety-one or the effective date of such local law, ordinance or
resolution, whichever is later, and/or (ii) that no exemption under this
section  shall be applicable within its jurisdiction with respect to any
micro-hydroelectric energy system, fuel cell electric generating system,
micro-combined heat and  power  generating  equipment  system,  electric
energy   storage   equipment  or  electric  energy  storage  system,  or
fuel-flexible linear generator electric  generating  system  constructed
subsequent to January first, two thousand eighteen or the effective date
of  such  local law, ordinance or resolution, whichever is later. A copy
of any such local law or resolution shall be filed with the commissioner
and with the president of the authority.
(b) Construction of a solar or wind energy  system  or  a  farm  waste
energy system shall be deemed to have begun upon the full execution of a
contract  or interconnection agreement with a utility; provided however,
that if such contract or interconnection agreement requires a deposit to
be made, then construction shall  be  deemed  to  have  begun  when  the
contract  or interconnection agreement is fully executed and the deposit
is made. The owner or developer of such a system shall  provide  written
notification to the appropriate local jurisdiction or jurisdictions upon
execution of the contract or the interconnection agreement.
9.  (a)  A  county,  city,  town, village or school district, except a
school district under article fifty-two of the education law,  that  has
not  acted  to  remove  the exemption under this section may require the
owner of a property which includes a solar or wind energy  system  which
meets  the  requirements  of  subdivision four of this section, to enter
into a contract for payments in lieu of taxes. Such contract may require
annual payments in an amount not  to  exceed  the  amounts  which  would
otherwise  be  payable  but for the exemption under this section. If the
owner or developer of such a system provides written notification  to  a
taxing  jurisdiction  of  its intent to construct such a system, then in
order to require the owner or developer of such system to enter  into  a

contract  for  payments  in lieu of taxes, such taxing jurisdiction must
notify such owner or developer in writing of its  intent  to  require  a
contract  for  payments  in lieu of taxes within sixty days of receiving
the  written notification. Written notification to a taxing jurisdiction
for  this  purpose  shall  include  a  hard  copy  letter  sent  to  the
highest-ranking  official  of the taxing jurisdiction. Such letter shall
explicitly  reference  subdivision  nine   of   section   four   hundred
eighty-seven  of  the  real  property  tax  law, and clearly state that,
unless the taxing jurisdiction responds within  sixty  days  in  writing
with  its  intent  to  require a contract for payments in lieu of taxes,
such project shall not be obligated to make such payments.
(b) Notwithstanding paragraph (a) of this subdivision, should a taxing
jurisdiction adopt a law or resolution at any time within  or  prior  to
the  sixty  day  window,  indicating  the  taxing jurisdiction's ongoing
intent to require a contract for payments in  lieu  of  taxes  for  such
systems,  such  law  or  resolution  shall be considered notification to
owners or developers and no further action is required on  the  part  of
the taxing jurisdiction, provided that such law or resolution remains in
effect through the end of the sixty day notification period.
(c)  Any  payment  in  lieu of a tax agreement shall not operate for a
period of more than fifteen years, commencing in each instance from  the
date  on which the benefits of such exemption first become available and
effective.
10. Notwithstanding the foregoing provisions of this  section,  on  or
after  April  first,  two  thousand  nineteen,  a  county, city, town or
village may by local law or a  school  district,  other  than  a  school
district to which article fifty-two of the education law applies, may by
resolution provide that real property that comprises or includes a solar
or  wind  energy  system,  farm  waste energy system, microhydroelectric
energy system, fuel cell electric generating system, microcombined  heat
and  power  generating equipment system, electric energy storage system,
or  fuel-flexible  linear  generator  as  such  terms  are  defined   in
paragraphs  (b),  (f), (h), (j), (l), (n), and (o) of subdivision one of
this  section  (hereinafter,  individually  or   collectively,   "energy
system"),  shall  be  permanently  exempt  from any taxation, special ad
valorem levies, and  special  assessments  to  the  extent  provided  in
section  four  hundred  ninety  of  this  article, and the owner of such
property shall not be  subject  to  any  requirement  to  enter  into  a
contract  for  payments  in lieu of taxes in accordance with subdivision
nine of this section, if: (a) the energy system  is  installed  on  real
property  that  is  owned  or  controlled  by  the  state of New York, a
department or agency thereof, or a  state  authority  as  that  term  is
defined by subdivision one of section two of the public authorities law;
and  (b)  the  state  of  New York, a department or agency thereof, or a
state authority as that term is defined by subdivision  one  of  section
two  of  the  public  authorities  law has agreed to purchase the energy
produced  by  such  energy  system  or  the  environmental  credits   or
attributes  created  by  virtue  of  the  energy  system's operation, in
accordance with a written agreement with the owner or operator  of  such
energy  system. Such exemption shall be granted only upon application by
the owner of the real property on a form prescribed by the commissioner,
which application shall be filed with the assessor  of  the  appropriate
county,  city,  town  or village on or before the taxable status date of
such county, city, town or village.