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Combined Heat and Power Partnership

Renewable Energy Tax Credit

dCHPP Glossary (PDF) (2 pp, 53K)

Date Last Updated10/23/2013
Incentive TypeTax
State/FederalNC
Incentive Administrator/Contact OfficeNC Department of Revenue
Incentive Initiation Date1/1/1977
Incentive Expiration Date12/31/2015
Incentive Size and Funding SourceNorth Carolina offers a tax credit equal to 35% of the cost of eligible renewable energy property placed into service in North Carolina during the taxable year. There is a maximum of $10,500 per installation for CHP systems or certain other renewable-energy systems used for a non-business purpose. There is a maximum of $2.5 million per installation for all CHP systems (as defined by Section 48 of the U.S. Tax Code) and biomass applications used for a business purpose, meaning the useful energy generated by the property is offered for sale or is used on-site for a purpose other than providing energy to a residence. Renewable-energy equipment expenditures eligible for the tax credit include the cost of the equipment and associated design; construction costs; and installation costs less any discounts, rebates, advertising, installation-assistance credits, name-referral allowances or other similar reductions provided by public funds.

The allowable credit may not exceed 50% of a taxpayer's state tax liability for the year, reduced by the sum of all other state tax credits. Qualifying renewable-energy systems used for a non-business purpose must take the maximum credit amount allowable for the tax year in which the system is installed. If the credit is not used entirely during the first year, the remaining amount may be carried over for the next 5 years. For all other taxpayers, the credit is taken in five equal installments beginning with the year in which the property is placed in service. If the credit is not used entirely during these 5 years, the remaining amount may be carried over for the next 5 years. The credit can be taken against franchise tax, corporate tax, income tax or in the case of insurance companies, against the gross premiums tax.
Eligible RecipientOwners of renewable energy property constructed, purchased or leased and placed into service in North Carolina during the taxable year.
Eligible FuelDoes Not Specify
Eligible Project Size (MW)Does Not Specify
Minimum Efficiency Required (%)Does Not Specify
Other Selected Eligibility CriteriaSystem must be new and in compliance with all applicable performance and safety standards. Specific equipment and installation requirements vary by technology.
Application Form(s)Tax Form NC-478G (PDF) (2 pp, 179K)

Tax Form NC-478 (PDF) (2 pp, 232K)
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