The IRS has released a notice (Notice 2015-4) that establishes performance and quality standards that small wind energy property must satisfy to qualify for the 30% investment tax credit under Section 48 of the Internal Revenue Code. Generally, to be eligible for the credit, the property must use a wind turbine with a nameplate capacity that does not exceed 100kW. More specifically, Notice 2015-4 provides that the turbine must satisfy performance and quality standards set forth in either of: (1) the American Wind Energy Association Small Wind Turbine Performance and Safety Standard 9.1-2009 (AWEA), or (2) the International Electrotechnical Commission 61400-1, 61400-12 and 61400-11 (IEC). The turbine must satisfy one of the published standards in effect at the time that the taxpayer acquires the turbine. If the taxpayer is constructing, reconstructing, or erecting the turbine, it must satisfy one of the published standards at the time it is placed in service.

A taxpayer may rely on a manufacturer’s certification that a turbine satisfies the AWEA standard or the IEC standard if the certification is issued by an “eligible certifier” and contains certain factual information regarding the turbine and the certifier, along with the certifier’s statement that the turbine complies with the applicable standard. Eligible certifiers are third parties accredited by the American Association for Laboratory Accreditation. Taxpayers need not submit the certifications with their tax returns, but should retain copies with their tax records.