Michigan bill looks to clarify tax exemptions for distributed generation projects

A bipartisan group of Michigan lawmakers introduced a bill last week that aims to clear up confusion over tax collections for small-scale distributed generation projects. HB 5143 would reinstate a tax exemption for “alternative energy personal property” that was in place for 10 years under the Michigan Next Energy Authority Act of 2002. That law — signed by former Republican Gov. John Engler — granted the exemption to 13 different kinds of small-scale renewable energy systems meant to offset any portion of a property’s energy use. The latest bill was introduced by Republican Rep. Tom Barrett and has two Democrat and four Republican co-sponsors, including House Energy Policy Chairman Gary Glenn, who has said he favors incentives for solar energy over mandates. It has been referred to the House Tax Policy Committee.While it applies to all types of properties, advocates say the bill is meant to provide clarity particularly for residential property owners with solar panels. Over the past several years, Michigan has seen a patchwork of communities that assess solar installations because they are improvements and boost the value of the property.