Property tax on wind turbines in general

Property tax on wind turbines

Property tax is paid for each wind turbine yearly and it’s paid for the municipality, where turbines are located. Especially in smaller municipalities, the property taxes paid by wind power play a significant role in the municipality’s economy.

Property tax rate for wind turbines can be maximum of 3,1 %, when the power of the wind farm is more than 10 megawatt-amperes (MVA). The tax is calculated on the bases of the investment costs of the foundation, tower, and nacelle, excluding the costs of the machinery and the blades. Therefore, typically about 30 % of the WTG investment costs are basis for the property tax. If the capacity of the power plant is less than 10 MVA, the property tax for the power plant is determined according to the general property tax rate of the municipality.

Mainly power plant property tax rate is used

The value of the property is deducted annually with the age discount percentage. Currently, the age discount for a wind turbine is 2,5 %. The taxable value decreases by this amount per year until it reaches the minimum taxable value of 40 %. The lifetime of a modern turbine is today more than 30 years, so the newest turbines will reach the minimum property tax rate during their lifetime. Depending on the power plant, the minimum taxable value will be reached in year 24 or 25, after which the onshore wind turbine will pay property tax of around 15 000 euros to 18 000 euros per year, depending on its investment cost.

The total amount of property tax paid by one onshore wind turbine located in wind farm is more than 400 000 euros during the 30 years of operation if the municipality has adopted the highest possible property tax rate for a power plant. If the wind turbine is not located in a wind farm, it is subject to property tax at the general municipal property tax rate as long as the capacity of the singe turbine is less than 10 MVA. For a single 3 MW onshore wind turbine not located in a wind farm, the property tax in the first year ranges from 6 000 euros to 11 500 euros. A single onshore wind turbine will generate property tax revenues of around 130 000 euros for the municipality over its lifetime.

Read more: Determination of property tax