(1) As used in this section:

1. (a) "Active solar system" has the same meaning as defined in Section 59-10-1014.
2. (b) "Biomass system" has the same meaning as defined in Section 59-10-1014.
3. (c) "Commercial energy system" has the same meaning as defined in Section 59-7-614.
4. (d) "Commercial enterprise" has the same meaning as defined in Section 59-7-614.

5. (e)

   1. (i) "Commercial unit" has the same meaning as defined in Section 59-7-614.

   2. (ii) Notwithstanding Subsection (1)(e)(i):

      1. (A) with respect to an active solar system used for agricultural water pumping or a wind system, each individual energy generating device is considered to be a commercial unit; or
      2. (B) if an energy system is the building or structure that a claimant, estate, or trust uses to transact business, a commercial unit is the complete energy system itself.
6. (f) "Direct use geothermal system" has the same meaning as defined in Section 59-10-1014.
7. (g) "Geothermal electricity" has the same meaning as defined in Section 59-10-1014.
8. (h) "Geothermal energy" has the same meaning as defined in Section 59-10-1014.
9. (i) "Geothermal heat pump system" has the same meaning as defined in Section 59-10-1014.
10. (j) "Hydroenergy system" has the same meaning as defined in Section 59-10-1014.
11. (k) "Office" means the Office of Energy Development created in Section 63M-4-401.
12. (l) "Passive solar system" has the same meaning as defined in Section 59-10-1014.
13. (m) "Principal recovery portion" has the same meaning as defined in Section 59-10-1014.
14. (n) "Wind system" has the same meaning as defined in Section 59-10-1014.

(3)

1. (a) Subject to the other provisions of this Subsection (3), a claimant, estate, or trust may claim a refundable tax credit under this Subsection (3) with respect to a commercial energy system if:

   1. (i) the commercial energy system does not use:

      1. (A) wind, geothermal electricity, solar, or biomass equipment capable of producing a total of 660 or more kilowatts of electricity; or
      2. (B) solar equipment capable of producing 2,000 or more kilowatts of electricity;
   2. (ii) the claimant, estate, or trust purchases or participates in the financing of the commercial energy system;

   3. (iii)

      1. (A) the commercial energy system supplies all or part of the energy required by commercial units owned or used by the claimant, estate, or trust; or
      2. (B) the claimant, estate, or trust sells all or part of the energy produced by the commercial energy system as a commercial enterprise;
   4. (iv) the commercial energy system is completed and placed in service on or after January 1, 2007; and
   5. (v) the claimant, estate, or trust obtains a written certification from the office in accordance with Subsection (6).

2. (b)

   1. (i) Subject to Subsections (3)(b)(ii) through (v), the tax credit is equal to 10% of the reasonable costs of the commercial energy system.
   2. (ii) A tax credit under this Subsection (3) may include installation costs.
   3. (iii) A claimant, estate, or trust may claim a tax credit under this Subsection (3) for the taxable year in which the commercial energy system is completed and placed in service.
   4. (iv) A tax credit under this Subsection (3) may not be carried forward or carried back.
   5. (v) The total amount of tax credit a claimant, estate, or trust may claim under this Subsection (3) may not exceed $50,000 per commercial unit.

3. (c)

   1. (i) Subject to Subsections (3)(c)(ii) and (iii), a claimant, estate, or trust that is a lessee of a commercial energy system installed on a commercial unit may claim a tax credit under this Subsection (3) if the claimant, estate, or trust confirms that the lessor irrevocably elects not to claim the tax credit.
   2. (ii) A claimant, estate, or trust described in Subsection (3)(c)(i) may claim as a tax credit under this Subsection (3) only the principal recovery portion of the lease payments.
   3. (iii) A claimant, estate, or trust described in Subsection (3)(c)(i) may claim a tax credit under this Subsection (3) for a period that does not exceed seven taxable years after the date the lease begins, as stated in the lease agreement.

(4)

1. (a) Subject to the other provisions of this Subsection (4), a claimant, estate, or trust may claim a refundable tax credit under this Subsection (4) with respect to a commercial energy system if:

   1. (i) the commercial energy system uses wind, geothermal electricity, or biomass equipment capable of producing a total of 660 or more kilowatts of electricity;

   2. (ii)

      1. (A) the commercial energy system supplies all or part of the energy required by commercial units owned or used by the claimant, estate, or trust; or
      2. (B) the claimant, estate, or trust sells all or part of the energy produced by the commercial energy system as a commercial enterprise;
   3. (iii) the commercial energy system is completed and placed in service on or after January 1, 2007; and
   4. (iv) the claimant, estate, or trust obtains a written certification from the office in accordance with Subsection (6).

2. (b)

   1. (i) Subject to Subsections (4)(b)(ii) and (iii), a tax credit under this Subsection (4) is equal to the product of:

      1. (A) 0.35 cents; and
      2. (B) the kilowatt hours of electricity produced and used or sold during the taxable year.
   2. (ii) A tax credit under this Subsection (4) may be claimed for production occurring during a period of 48 months beginning with the month in which the commercial energy system is placed in commercial service.
   3. (iii) A tax credit under this Subsection (4) may not be carried forward or back.
3. (c) A claimant, estate, or trust that is a lessee of a commercial energy system installed on a commercial unit may claim a tax credit under this Subsection (4) if the claimant, estate, or trust confirms that the lessor irrevocably elects not to claim the tax credit.

(5)

1. (a) Subject to the other provisions of this Subsection (5), a claimant, estate, or trust may claim a refundable tax credit as provided in this Subsection (5) if:

   1. (i) the claimant, estate, or trust owns a commercial energy system that uses solar equipment capable of producing a total of 660 or more kilowatts of electricity;

   2. (ii)

      1. (A) the commercial energy system supplies all or part of the energy required by commercial units owned or used by the claimant, estate, or trust; or
      2. (B) the claimant, estate, or trust sells all or part of the energy produced by the commercial energy system as a commercial enterprise;
   3. (iii) the claimant, estate, or trust does not claim a tax credit under Subsection (3);
   4. (iv) the commercial energy system is completed and placed in service on or after January 1, 2015; and
   5. (v) the claimant, estate, or trust obtains a written certification from the office in accordance with Subsection (6).

2. (b)

   1. (i) Subject to Subsections (5)(b)(ii) and (iii), a tax credit under this Subsection (5) is equal to the product of:

      1. (A) 0.35 cents; and
      2. (B) the kilowatt hours of electricity produced and used or sold during the taxable year.
   2. (ii) A tax credit under this Subsection (5) may be claimed for production occurring during a period of 48 months beginning with the month in which the commercial energy system is placed in commercial service.
   3. (iii) A tax credit under this Subsection (5) may not be carried forward or carried back.
3. (c) A claimant, estate, or trust that is a lessee of a commercial energy system installed on a commercial unit may claim a tax credit under this Subsection (5) if the claimant, estate, or trust confirms that the lessor irrevocably elects not to claim the tax credit.

(6)

1. (a) Before a claimant, estate, or trust may claim a tax credit under this section, the claimant, estate, or trust shall obtain a written certification from the office.

2. (b) The office shall issue a claimant, estate, or trust a written certification if the office determines that:

   1. (i) the claimant, estate, or trust meets the requirements of this section to receive a tax credit; and

   2. (ii) the office determines that the commercial energy system with respect to which the claimant, estate, or trust seeks to claim a tax credit:

      1. (A) has been completely installed;
      2. (B) is a viable system for saving or producing energy from renewable resources; and
      3. (C) is safe, reliable, efficient, and technically feasible to ensure that the commercial energy system uses the state's renewable and nonrenewable resources in an appropriate and economic manner.

3. (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the office may make rules:

   1. (i) for determining whether a commercial energy system meets the requirements of Subsection (6)(b)(ii); and
   2. (ii) for purposes of a tax credit under Subsection (3), establishing the reasonable costs of a commercial energy system, as an amount per unit of energy production.
4. (d) A claimant, estate, or trust that obtains a written certification from the office shall retain the certification for the same time period a person is required to keep books and records under Section 59-1-1406.

(10)

1. (a) On or before October 1, 2017, and every five years after 2017, the Revenue and Taxation Interim Committee shall review each tax credit provided by this section and report its recommendations to the Legislative Management Committee concerning whether the credit should be continued, modified, or repealed.
2. (b) The Revenue and Taxation Interim Committee's report under Subsection (10)(a) shall include information concerning the cost of the credit, the purpose and effectiveness of the credit, and the state's benefit from the credit.