The residential solar energy war just continues to heat up more and more in the (already quite sunny and hot) state of Arizona. The State Department of Revenue there has done an about-face on PV tax policy, and is now saying that only solar panels owned outright are exempt from tax, leased panels are no longer eligible for tax exemption.
The move isn’t necessarily surprising, but it is a bit hard to understand from the department’s perspective. Unless of course the department is in bed with the state utility Arizona Public Service and working to undermine the cost benefits of adopting solar power in Arizona, as many observers have suggested.
As it stands currently, in Arizona, solar leasing contracts account for the majority of distributed solar generation, so removing the exemption for such leased panels would likely lead to increased leasing costs for consumers — something that those in the utilities industry would no doubt be happy to see occur.
The move, proposed by Arizona’s State Department of Revenue, would see a reinterpretation of the standing tax policy that says that solar equipment is exempt from property tax. Until now, this had applied to all types of rooftop solar panels, but, if that changes, then homeowners who lease may be facing a $152 increase to their annual property tax bill.
“Arizona is breaking new ground for being an extremely strange political environment,” noted Bryan Miller, president of The Alliance for Solar Choice (TASC). Miller also noted that it was humorous to see such a policy emerge in a state that was otherwise so strongly “anti-tax.”
I wonder… 🙂
If the new interpretation of the solar tax law ends up sticking, then it will come into effect at the beginning of October 2015.
Arizona has become something of a battleground between utility companies and solar system providers in recent months (and a battleground between Tesla and car dealerships as well, for that matter). Too bad, considering that the turmoil is definitely putting a dent in what would otherwise be a very healthy market.
Considering how sunny Arizona is, it’s a bit funny to see so much opposition to the use of this resource.