Rebates

Commercial and net metering alternative energy investments of $5,000 or more are eligible for a tax credit of up to 35% against individual or corporate tax on income generated by the investment. The investment must be depreciable. The credit is applied only against taxes due as a consequence of taxable or net income produced by:

• A manufacturing plant that is located in Montana and that produces alternative energy generating equipment;
• A new business facility or the expanded portion of an existing business facility that supplies basic energy needed from the alternative energy generating equipment, on a direct contract sales basis

The Alternative Energy Revolving Loan Program (AERLP) provides loans to individuals, small businesses, local government agencies, units of the university system, and nonprofit organizations to install alternative energy systems that generate energy for their own use. The program is funded by air quality penalties collected by the Department of Environmental Quality (DEQ), and also used funding from The American Recovery and Reinvestment Act of 2009 (ARRA). The program is administered by DEQ, which is responsible for developing the rules.

Alternative energy systems are defined by the Montana Code as "the generation system or equipment used to convert energy sources into

The lab network serves as a technical resource of credible and unbiased information and education to facilitate energy efficient design to achieve high-performance buildings. Each lab provides access to information, tools, and resources on integrated design and other high-performance building practices and a variety of advisory services that include integrated design process and methods, climate analysis and appropriate building responses, daylighting and electric lighting, and modeling (daylighting and energy performance).

Much of the information presented in this summary is drawn from the U.S. Department of Energy’s (DOE) Building Energy Codes Program and the Building Codes Assistance Project (BCAP). For more detailed information about building energy codes, visit the DOE and BCAP websites.

The energy codes are reviewed on a three-year cycle corresponding to the adoption of new versions of the International Code Conference (ICC) Uniform Codes. Proposed changes are submitted to the Building Codes Bureau. In fall 2014, Montana adopted the 2012 IECC with state amendments. If an approved local government code enforcement program does not exist, the State Building Codes

Montana generating plants producing one megawatt (MW) or more with an alternative renewable energy source* are eligible for the new or expanded industry property tax reduction. This incentive reduces the local mill levy during the first nine years of operation, subject to approval by the local government. If approved, the facility is taxed at 25% or 50% of its taxable value in the first five years following the issuance of the construction permit. Each year thereafter, the tax reduction decreases and the taxable value percentage is increased in equal increments until the full taxable value is attained in the tenth

The State of Montana has established a tax credit for the conversion of gasoline vehicles to alternative fuel vehicles. This credit is available for individuals, corporations, partnerships, and small businesses. Alternative fuel for the purposes of this law means natural gas, liquefied natural gas, liquefied petroleum gas, electricity, hydrogen, or any other fuel if at least 85% of it is methanol, ethanol/other alcohol, ether, or any combination of these.

Individual taxpayers may claim a credit against their income tax liability for up to 25% of the costs of investment for energy conservation purposes in a building.  The maximum credit is $500 per individual (a married couple filing jointly can claim a tax credit of $1,000). The credit must be claimed in the year that the expenditure is made. It is nonrefundable and may not be carried over to future years. For doors, windows, and skylights in new construction, only the amount spent to surpass the applicable state or federal construction and energy standards may be used.

Use Montana Department

Flathead Electric encourages its residential customers to occupy energy efficient homes. Owners and builders of new homes which meet the "Montana Homes" requirements listed on the program web site are eligible for a rebate of $1,500. All application information and home testing must be completed before a rebate may be issued. Further information can be found on the program web site.

In addition to this offer, a $1,200 rebate is payable to Northwest Energy Efficient Manufactured (NEEM) home buyers who site a new electrically heated NEEM home in Flathead Electric service territory. Rebates are payable after the home has been

Flathead Electric offers incentives for residential customers to increase energy efficiency in homes through a variety of equipment rebates. Flathead Electric offers rebates for appliances, duct sealing, building insulation, window replacements, heat pumps and other measures. See the program website for a complete list of available incentives. All rebates are subject to a post-installation inspection performed by Flathead Electric to ensure proper installation of qualifying equipment. Contact Flathead Electric for more information on these programs prior to starting your project.

New electricity generating facilities built in Montana with a capacity of up to one megawatt (MW) that use an alternative renewable energy source are exempt from property taxes for five years after operation begins. The taxable value of the property varies depending on the property ownership and class. The assessed value of personal property is adjusted yearly based on a trend factor that reflects the relevant rate of inflation and on the Montana Department of Revenue’s depreciation schedule. State property tax exemption forms are available at the Department of Revenue’s county office.

"Alternative renewable energy source" includes energy sources such

In July 2010, the Montana Public Service Commission (PSC) adopted interconnection rules, effective August 13, 2010. These rules apply to all electric utilities under the PSC's jurisdiction, including investor-owned utilities and co-ops. Small generators, or systems for the production and or storage of electricity with a nameplate capacity up to 10 megawatts (MW), located on the land of utility customers within good standing are allowed to interconnect. While there is no statewide standard interconnection agreement, the largest investor-owned utility in Montana, NorthWestern, does have a standard interconnection agreement for net-metered systems. The use of certain equipment may qualify a facility

In Montana, regulated electric utilities are required to offer customers the option of purchasing electricity generated by certified, environmentally-preferred resources that include, but are not limited to, wind, solar, geothermal and biomass. NorthWestern Energy implemented a green-power program ("E+ Green") in June 2003.

Property-Assessed Clean Energy (PACE) financing effectively allows property owners to borrow money to pay for energy improvements. The amount borrowed is typically repaid via a special assessment on the property over a period of years. In 2021, S.B. 147 authorized the creation of a Commercial PACE (C-PACE) program to be administered by the Montana Facility Finance Authority (MFFA). To be eligible, properties must be located in a Montana city, county, town, or a consolidated city-town that has or will establish a C-PACE District. C-PACE District designation is tracked by the MFFA and may be viewed here.

The C-PACE program

Brief

Montana's solar and wind easement provisions allow property owners to create solar and wind easements for the purpose of protecting and maintaining proper access to sunlight and wind. Solar easements should be negotiated with neighboring property owners. Montana's solar easement law was enacted in 1979; the wind easement law was originally enacted in 1983.

Solar Easements:

An easement must be created in writing and is subject to the same conveyancing and instrument recording requirements as other easements on real property. The easement must specify at least (1) the vertical and horizontal angles, expressed in degrees, at which the solar

Montana-Dakota Utilities (MDU) offers several residential rebates for investing in high-efficient equipment for natural gas and electric customers. Natural gas customers are eligible for rebates on natural gas furnaces, programmable thermostats, and LED light bulbs if the equipment meets program efficiency standards.

Rebate payments are issued in the form of a check. See program web site listed above to view application form or to see more program information. Only residential MDU customers living in Montana are eligible for rebates.

Eligibility and Applicability

Montana's net-metering law, enacted in July 1999, applies to all customers of investor-owned utilities. Systems up to 50 kilowatts (kW) in capacity that generate electricity using solar, wind or hydropower are eligible. No limit on enrollment or statewide installed capacity is specified. Utilities may not require customer-generators to comply with any additional standards or requirements beyond those established by the National Electric Code, National Electrical Safety Code, Institute of Electrical and Electronic Engineers (IEEE), and Underwriters Laboratories (UL).

Net Excess Generation

Net excess generation (NEG) is credited to the customer's next monthly bill. The customer may choose

Eligibility and Applicability

Montana's net-metering law, enacted in July 1999, applies to all customers of investor-owned utilities. Systems up to 50 kilowatts (kW) in capacity that generate electricity using solar, wind or hydropower are eligible. No limit on enrollment or statewide installed capacity is specified. Utilities may not require customer-generators to comply with any additional standards or requirements beyond those established by the National Electric Code, National Electrical Safety Code, Institute of Electrical and Electronic Engineers (IEEE), and Underwriters Laboratories (UL).

Net Excess Generation

Net excess generation (NEG) is credited to the customer's next monthly bill. The customer may choose

NorthWestern Energy offers a variety of rebates for residential customers to make energy efficiency improvements in their existing homes. Electric supply customers who purchase or implement energy efficient lighting and controls are eligible for prescriptive rebates from NorthWestern. There are also many rebates available for natural gas space and water-heating. Details for all rebate offerings are found on the program web site listed above. Rebates are available for existing and new homes.

NorthWestern Energy offers a variety of rebates for residential customers to make energy efficiency improvements in their existing homes. Incentives are available for heating equipment, insulation, programmable thermostats, fan controllers, and water heating. See program website for details on eligible measures and incentive amounts. 

Customers building a new home are also eligible for incentives for natural gas space and water heating under the E+ New Homes Program.

Rebates for lighting fixtures and sensors are also available for NorthWestern electric customers.

NorthWestern Energy (NWE), formerly Montana Power Company, periodically provides funding to its customers for renewable energy projects. In 1997, Montana established the Universal System Benefits (USB) program. The USB legislation requires all electric and gas utilities to establish USB funds for low-income energy assistance, weatherization, energy efficiency activities, and development of renewable energy resources. A typical NorthWestern Energy residential customer pays approximately $1 per month in electric USB charges. In 2021, NorthWestern’s USB charge generated over $10 million, of which about $900,000 was used for renewable resources, and research and development projects.

The E+ Renewable Energy Program provides custom

In May 2007, Montana enacted legislation (H.B. 3) that allows a property tax abatement for new renewable energy production facilities, new renewable energy manufacturing facilities, and renewable energy research and development equipment. Eligible facilities and equipment are assessed at 50% of their taxable value.

Qualifying renewable energy manufacturing facilities are those that (1) produce materials, components or systems to convert solar, wind, geothermal, biomass, biogas or waste heat resources into useful energy, and (2) whose annual production of renewable energy equipment makes up at least half of the facility's total production. Fuel cells and components of fuel cells that generate

Montana's property tax exemption for recognized non-fossil forms of energy generation and low emission wood or biomass combustion devices may be claimed for 10 years after installation of the property. The exemption is allowed for up to $20,000 in value for single-family residential dwellings and up to $100,000 in value for multi-family residential dwellings or non-residential structures. This property is class 4 property and otherwise would be taxed on 2.54% of assessed value in tax year 2013 and 2.47% in tax years after 2013.

Recognized forms of energy generation include solar photovoltaics, passive solar, wind, solid waste, decomposition of organic

Note: H.B. 576 of 2021 repealed this RPS. The information below is presented for informational purposes only. 

Montana’s renewable portfolio standard (RPS), enacted in April 2005 as part of the Montana Renewable Power Production and Rural Economic Development Act, requires public utilities and competitive electricity suppliers serving 50 or more customers to obtain a percentage of their retail electricity sales from eligible renewable resources according to the following schedule:

• 5% for compliance years 2008-2009 (1/1/2008 - 12/31/2009)
• 10% for compliance years 2010-2014 (1/1/2010 - 12/31/2014)
• 15% for compliance year 2015 (1/1/2015 - 12/31/2015) and for each year thereafter

Public utilities

Repealed by S.B. 399. Credit is unavailable for installations in beginning in 2022.

Residential taxpayers who install an energy system using a recognized non-fossil form of energy on their home after December 31, 2001 are eligible for a tax credit equal to the amount of the cost of the system and installation of the system, not to exceed $500. This cap is for individual taxpayers, so married taxpayers filing jointly can get a tax credit of up to $1,000 per household. The tax credit may be carried over for the following four taxable years.

Recognized non-fossil forms of energy

A resident individual taxpayer of Montana who installs a geothermal heating or cooling system in his or her principal dwelling is eligible for a tax credit based on the installation costs of the system. The credit may not exceed $1,500, and only one credit may be claimed per household. If not used fully in the first year the system is installed, the credit may be carried forward for the 7 succeeding tax years. 

Use Montana Department of Revenue Form ENRG-A to claim this tax credit.

Montana established the Universal System Benefits Program (USBP) in 1997 as part of its restructuring legislation. The USBP supports cost-effective energy conservation, low-income customer weatherization, renewable-energy projects and applications, research and development programs related to energy conservation and renewables, market transformation designed to encourage competitive markets for public purpose programs, and low-income energy assistance.

Beginning January 1, 1999, all electric utilities -- including electric cooperatives -- were required to contribute revenue generated from a surcharge on customers' electricity use. In 1997, the surcharge was set through electricity restructuring legislation and was based on 2.4% of electric utilities' 1995 revenues. This

The Yellowstone Valley Electric Cooperative offers rebates to residential and commercial members for purchasing energy efficient add-on heat pumps, geothermal heat pumps, water heaters, dishwashers, dryers, refrigerators, washing machines, lighting, smart thermostats and solar stock watering systems.

For all products, YVEC offers a rebate within 90 days of purchase. Rebate applications are located on the program web site. All installation, equipment and other qualifying requirements must be met. Please contact Yellowstone Valley Electric Cooperative or visit the program website for additional information.

Yellowstone Valley Electric Cooperative (YVEC) offers rebates to members for the installation of a solar panel array for the purpose of watering their stock. To be eligible for the rebate, members must be in good standing with YVEC, receiving electric service from YVEC, and the system must be installed in an area that would normally be served by YVEC if a line extension were to be installed for electric service to the well. For installations costing up to $2,000, a rebate of 50% of the installed cost will be given. For installations costing more than $2,000, a rebate of $1,000