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Parties File Comments On Establishing A Uniform Capacity Tax For Solar PV Systems Installed In The State
In Connecticut, parties filed comments on the draft report that was issued on December 5, 2025.
See: PA 24-31 Solar Taxation Report Draft.pdf
As background, DEEP was directed by a new state law to conduct a study concerning the feasibility and potential cost-related impacts of establishing a uniform capacity tax for solar PV systems installed in the state.
Developer Verogy asked that “DEEP more directly comply with the task of: (a) identifying what tax amount per megawatt of electric generation capacity would fairly compensate municipalities without making such projects unviable; and (b) recommending legislative changes to address this situation. ”
Developer Greenskies Clean Focus said “…a fixed, uniform capacity tax (UCT) on most large projects and clarifying the exemption status of other project types is the most straightforward and easy to implement method which supports the report’s conclusion. Three basic guidelines can resolve all the confusion and frustration. 1. All systems smaller than 2MWac are tax exempt. 2. Systems larger than 2Mwac, which are installed behind the meter, serving on-site load, (traditional “Net Metering” configuration), are tax exempt. 3. Systems larger than 2MWac, not serving on-site load, pay an annual flat rate based on installed capacity (“Nameplate MWac”). We believe the rate proposed in the 2023 legislation of $8000/MWac is a fair and just rate.”
Solar group CONNSSA said, “An $8,000/MW UCT rate is fair [and]…would provide at least as much more new tax revenue to municipalities than any other similar program in any other Northeast state.”
The Connecticut Council of Small Towns took an opposite position from the developers, arguing: 1) “The UCT must be set at a per megawatt rate that is sufficient to offset lost personal property tax revenues. Legislation under consideration would have established a rate of $8,000 per megawatt per year, which is too low. COST supports a rate of not less than $12,000 per megawatt per year which is more consistent with the loss of personal property tax revenues. 2) The UCT must include an escalator provision to ensure that the tax rate reflects an annual percentage increase, given inflation and other factors affecting municipal budgets. 3) Clarification that the UCT is applicable to personal property taxes and that the real property on which the system is located will be taxed as commercial property. 4) Provision that ensures that Tax Stabilization Agreements that have been negotiated by municipalities and solar developers remain in place. 5) Clarification that solar developers cannot sidestep property taxes by splitting up systems onto adjoining properties to take advantage of exemptions. ”
DEEP Proceeding – Public Act 24-31 – Section 1 – Solar Taxation Study (Opened 10/01/2024)
