Sales and Use Tax Exemption for Renewable Energy Property

This tax incentive applies to large-scale renewable energy projects (wind, solar, geothermal, biomass, hydroelectric, and related technologies) that sell electricity, not residential or small commercial installations. If you are part of a business or utility investing at least $20–30 million in qualified renewable property, you may qualify for a refund of sales and use taxes paid on equipment and materials, though the first 1.5% of municipal sales tax is not refunded.

You can support Tier 5 renewable energy projects that meet the $20–30 million investment threshold for electricity-sale operations. Eligible customers receive refunds of sales and use taxes on qualified property, materials incorporated into real estate, and equipment rentals when they maintain baseline employment levels. Document all purchases carefully and work with the Tax Commissioner to verify project qualification and track employment to avoid partial benefit recapture.

This sales-tax-refund program is part of Nebraska's Advantage Act (Tier 5) for large renewable energy projects producing electricity for sale. Qualifying projects must invest at least $20 million in renewable property or $30 million in other qualified property; refunds cover all state and local sales taxes except the first 1.5% of municipal tax. Administer refunds during the entitlement period and apply partial recapture if taxpayers fall below baseline equivalent-employment levels. Note: new applications were closed after December 31, 2020, but existing agreements remain in force.