North Dakota Solar Panel Permits & Incentives Guide

Quick Answer: Solar Permits & Incentives in North Dakota

North Dakota does not have a statewide solar permitting framework. Permit requirements vary by local city or county building department in areas like Fargo, Bismarck, and Dickinson, as well as in rural locations.

The state offers two significant incentive programs:

• A Renewable Energy Property Tax Exemption, managed by the North Dakota Department of Commerce, which exempts solar equipment from local property taxes.
• A Net Metering policy, established in 1991 by the Public Service Commission (PSC). This policy applies to systems up to 100 kW for customers of investor-owned utilities.

Federal incentives, primarily the Residential Clean Energy Credit under IRS §25D, offer a 30% uncapped tax credit through 2032. This credit can be used alongside both state programs.

North Dakota lacks statewide interconnection standards. Rules differ by utility, requiring direct negotiation.

Navigating North Dakota's Solar Permit Requirements

North Dakota does not have statewide solar permitting regulations. The state delegates building code authority to local jurisdictions. Your first point of contact should be the Authority Having Jurisdiction (AHJ), usually your city or county building department.

Finding Your AHJ

Start with these resources based on your location:

• Fargo: City of Fargo Planning & Development Department (fargond.gov)
• Bismarck: Bismarck Building Services Division (bismarcknd.gov)
• Grand Forks: Grand Forks Building Inspection Department (grandforksgov.com)
• Rural counties: Contact your county auditor or county commission office. They can direct you to the appropriate building official.

Permit fees and processing times vary by jurisdiction. Consult your local AHJ for current fee schedules and expected turnaround times, as these are not standardized statewide.

Common Permits Required

Most residential solar installations require:

• Building permit: This covers structural modifications, roof penetrations, and mounting systems.
• Electrical permit: This is required for all wiring, inverter installation, and connection to the main panel. Typically, a licensed electrician must pull this permit.
• Zoning or land use approval: Some municipalities require a separate review, especially for ground-mounted systems or installations in historic districts.

Documentation You'll Need

Prepare these documents before submitting your application. Most AHJs require:

• Site plan showing panel placement, setbacks, and property boundaries.
• Electrical schematic or single-line diagram.
• Structural analysis or an engineer's letter confirming roof load capacity.
• Equipment specifications and cut sheets for panels, inverters, and racking.
• Installer's contractor license number (required in most ND jurisdictions).

Post-Installation Inspections

After installation, your AHJ will schedule inspections for electrical work and structural attachment. Your utility also conducts an inspection before approving interconnection. Do not energize the system before receiving approval from both.

North Dakota State Solar Incentives & Policies

Renewable Energy Property Tax Exemption

North Dakota exempts solar, wind, and geothermal energy devices from local property taxes. The North Dakota Department of Commerce administers this program. (tax.nd.gov/tax-exemptions-credits/property-tax-exemptions).

Key details:

• Applies to systems serving new or existing buildings.
• Covers systems designed for heating, cooling, mechanical power production, or energy storage.
• For hybrid systems combining renewable and conventional energy, only the renewable component qualifies.
• Stand-alone systems are eligible.

To claim the exemption, contact the North Dakota Department of Commerce or your county tax assessor's office. The exemption is applied at the local property tax level and processed through your county.

Net Metering Policy

North Dakota's net metering policy, adopted in 1991 by the Public Service Commission (PSC), includes the following:

If you are served by a municipal utility or rural electric cooperative, inquire directly about voluntary net metering or buyback arrangements, as no state mandate requires them.

Renewable and Recycled Energy Objective

North Dakota's H.B. 1506 (March 2007) established a voluntary objective: 10% of retail electricity sold in the state from renewable or recycled energy by 2015. There is no penalty for providers who do not meet this objective. It serves as a policy signal, not an enforceable standard, and does not directly provide financial incentives for individual solar owners.

Solar Easements

North Dakota law allows property owners to obtain a solar easement from a neighbor to protect sunlight access for a solar energy system.

A valid solar easement in North Dakota must include:

• The vertical and horizontal angles, expressed in degrees, defining the easement over the burdened property.
• Any terms and conditions for granting or terminating the easement.
• Any compensation arrangements between the parties.

Solar easements are voluntary agreements. North Dakota does not mandate their granting, so negotiate early if shading from adjacent structures or trees is a concern.

Federal Solar Tax Credits: Maximizing Savings in North Dakota

IRS §25D Residential Clean Energy Credit

The Residential Clean Energy Credit (IRS §25D) provides a 30% federal income tax credit on eligible solar equipment installed at your primary or secondary residence. The credit is uncapped.

Eligible Equipment

• Solar photovoltaic (PV) panels
• Solar water heating systems (must meet Energy Star requirements)
• Battery storage systems with a capacity of 3 kWh or greater
• Geothermal heat pumps
• Small wind turbines
• Fuel cell systems

Installation labor costs are included.

How It Stacks With North Dakota Programs

The federal credit stacks with North Dakota's property tax exemption. The exemption reduces ongoing tax liability, not the system's purchase price, so it does not affect the §25D credit basis.

Net metering credits are bill offsets, not taxable income or rebates. Therefore, they do not reduce your federal credit basis.

If North Dakota or a local utility offers a direct cash rebate, IRS Notice 2013-70 clarifies that such rebates may reduce the federal credit basis. Currently, North Dakota's primary state incentive is a property tax exemption, not a cash rebate. Confirm with a tax professional if new rebate programs emerge.

Claiming the Credit

File IRS Form 5695 (Residential Energy Credits) with your federal tax return for the year your system is placed in service. Keep all receipts, contracts, and equipment documentation. Unused credit can be carried forward to subsequent tax years.

Interconnecting Your Solar System in North Dakota

North Dakota lacks statewide interconnection standards. Each utility sets its own rules, application forms, technical requirements, and timelines.

Major Utility Providers and Where to Start

For all utilities, search "[utility name] distributed generation interconnection" or call customer service.

Typical Interconnection Steps

1. Submit an interconnection application to your utility before or at the same time as your permit application. Some utilities require pre-approval.
2. Technical review evaluates whether your system requires grid upgrades or additional protective equipment. Small residential systems typically pass without issues.
3. Sign the interconnection agreement, a formal contract governing grid connection and excess generation.
4. Utility inspection verifies the installed system meets technical requirements.
5. Permission to operate: The utility issues written authorization to energize your system. Do not energize until authorized.

Recent Changes to North Dakota Solar Regulations

North Dakota's core solar policies, including net metering rules adopted by the PSC, the Renewable Energy Property Tax Exemption, and the solar easement law, have remained stable for several years without significant legislative changes.

North Dakota's H.B. 1506 voluntary renewable energy objective remains unchanged. The 2015 target year of 10% has passed, and the legislature has not updated the objective with new targets or enforcement mechanisms.

The federal Residential Clean Energy Credit under IRS §25D continues through 2032 at 30% under current law, providing a reliable planning horizon.

Changes are most likely to occur at the local level. Individual cities and counties periodically update building codes, permit fee schedules, and zoning ordinances. Check with your AHJ before finalizing project plans. Utilities may also update interconnection procedures or net metering billing practices independently of state legislation.

Available Rebates & Incentives

• Renewable Energy Property Tax Exemption: Exempts locally-assessed solar, wind, or geothermal energy devices from local property taxes. Eligibility includes systems serving new or existing buildings.
• Net Metering: Allows renewable energy systems up to 100 kW to receive credits for excess generation. Available to customers of investor-owned electric utilities only.
• North Dakota Solar/Wind Easements and Laws: Provides a legal framework for property owners to secure solar easements, ensuring adequate sunlight exposure for solar energy systems.

Federal Tax Deductions

The IRS offers a 30% uncapped federal tax credit under §25D for residential solar PV, solar water heating, battery storage (≥3 kWh), geothermal, and small wind systems. This credit is available through 2032 and can be claimed on Form 5695. Consult a tax professional for personalized advice and to understand how this credit may interact with state incentives.

Frequently Asked Questions

Why doesn't North Dakota have statewide solar permitting regulations?

North Dakota delegates building code authority to local jurisdictions, allowing cities and counties to establish their own permitting processes based on local needs and conditions.

What are the main incentives for solar energy in North Dakota?

North Dakota offers a Renewable Energy Property Tax Exemption and a Net Metering policy for systems up to 100 kW, which can be combined with the 30% federal tax credit under IRS §25D.

How does North Dakota's solar policy compare to neighboring states?

Unlike some neighboring states with more comprehensive solar programs, North Dakota relies on local jurisdictions for permitting and lacks a strong statewide framework, which can lead to inconsistencies in the permitting process.

Next Steps: Key Contacts for Your North Dakota Solar Project

Identify these contacts before signing a contract.

Local Building Department (Your AHJ) Apply for permits here. Search "[your city or county] building department" or contact your county auditor for unincorporated areas.

Your Utility Provider Contact them early for interconnection application forms and to confirm net metering eligibility. Do not assume qualification. Your electric bill lists your utility.

North Dakota Department of Commerce For questions about the Renewable Energy Property Tax Exemption, visit commerce.nd.gov or contact the department.

North Dakota Public Service Commission (PSC) For questions about net metering policy applicability and utility compliance, visit psc.nd.gov.

DSIRE (Database of State Incentives for Renewables