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New Jersey

New Jersey

Incentives/Policies for Renewables & Efficiency

Printable Version
Wind Manufacturing Tax Credit   

Last DSIRE Review: 09/06/2012
Program Overview:
State: New Jersey
Incentive Type: Industry Recruitment/Support
Eligible Renewable/Other Technologies: Wind
Applicable Sectors: Commercial, Industrial
Amount:100% of the qualified capital investment
Maximum Incentive:No specific per project limitation; $100 million limit for all offshore wind tax credits (may be exceeded if EDA deems appropriate)
Terms:Minimum $50 million investment and 300 new full-time employees; facilities must be located within a qualified wind energy zone (i.e., the South Jersey Port District); investment must yield a net positive benefit for the state; sales and transfers permitted subject to certain limitations.
Start Date:08/19/2010
Expiration Date:01/13/2013 (initial application deadline)
01/13/2016 (documentation for approval submission deadline)
Authority 1:
Date Enacted:
Date Effective:
N.J. Stat. § 34:1B-207 et seq.
08/19/2010 (wind energy specific portion; subsequently amended)
08/19/2010 (wind energy specific portion)
Authority 2:
Date Enacted:
N.J. Stat. § 48:3-51
1999 (subsequently amended)
Authority 3:
Date Enacted:
S.B. 1562
08/07/2012
Summary:

In August 2010 New Jersey enacted legislation (S.B. 2036) creating an offshore wind resource requirement within the state renewables portfolio standard (RPS) and tax incentives for certain businesses engaged in manufacturing wind energy equipment. The term "business" is defined to include corporations subject to the state franchise tax, corporations subject to the state's insurance premiums tax, as well as partnerships, S-corporations, and limited liability corporations. The allowable tax credit is equal to 100% of the qualified capital investment made by a business. The applicant must demonstrate the state's financial support of the facility will yield a net positive benefit for the state. The program is administered by the New Jersey Economic Development Authority (EDA).

In order to qualify for the tax credit, a business must make a minimum capital investment of $50 million in a qualifying wind energy facility which employs at least 300 new full-time employees. A tenant occupying a leased area within a qualifying wind energy facility must meet a minimum investment threshold of $17.5 million. The term qualifying wind energy facilities is defined as "any building, complex of buildings, or structural components of buildings, including water access infrastructure, and all machinery and equipment used in the manufacturing, assembly, development or administration of component parts that support the development and operation of a qualified offshore wind project, or other wind energy project* as determined by the authority, and that are located in a wind energy zone." A "wind energy zone" is defined as property within the South Jersey Port District.

The offshore wind portion of this tax credit operates as an addition to 2007 legislation creating the Urban Transit Hub Tax Credit. Tax credits for qualifying wind facilities are generally limited to $100 million in aggregate, although the EDA has discretion to allocate tax credits that exceed this cap to "meritorious" projects if sufficient tax credit volume is available. In total, the EDA may not allocate Urban Transit Hub Tax Credits exceeding $1.75 billion. Businesses must apply for a tax credit to the EDA by January 13, 2013 (five years after the effective date of the original Urban Transit Hub Tax Credit Act), and submit documentation for approval of the credit amount by January 13, 2016 (eight years after the original effective date).

Businesses may take the tax credit in equal increments over a 10-year period, beginning with the tax period for which the business is first approved as having met the required investment and employment qualifications. In lieu of taking the tax credit, a business may apply to the EDA for a certificate that allows them to transfer the tax credit to another party. Any tax credit sales that take place under this allowance must be for at least 75% of the face value of the credit.


*While most sections of S.B. 2036 apply to specifically to offshore wind energy, it appears that based on this definition, wind energy manufacturing facilities in general qualify for tax credits.


 
Contact:
  Business Service Center - NJ EDA
New Jersey Economic Development Authority
Phone: (866) 534-7789
E-Mail: CustomerCare@njeda.com
Web Site: http://www.njeda.com/
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Disclaimer: The information presented on the DSIRE web site provides an unofficial overview of financial incentives and other policies. It does not constitute professional tax advice or other professional financial guidance, and it should not be used as the only source of information when making purchasing decisions, investment decisions or tax decisions, or when executing other binding agreements. Please refer to the individual contact provided below each summary to verify that a specific financial incentive or other policy applies to your project.

While the DSIRE staff strives to provide the best information possible, the DSIRE staff, the N.C. Solar Center, N.C. State University and the Interstate Renewable Energy Council, Inc. make no representations or warranties, either express or implied, concerning the accuracy, completeness, reliability or suitability of the information. The DSIRE staff, the N.C. Solar Center, N.C. State University and the Interstate Renewable Energy Council, Inc. disclaim all liability of any kind arising out of your use or misuse of the information contained or referenced on DSIRE Web pages.

Copyright 2013 - 2014 North Carolina State University, under NREL Subcontract No. XEU-0-99515-01. Permission granted only for personal or educational use, or for use by or on behalf of the U.S. government. North Carolina State University prohibits the unauthorized display, reproduction, sale, and/or distribution of all or portions of the content of the Database of State Incentives for Renewables and Efficiency (DSIRE) without prior, written consent.