House Bill No. 5442 amends the property tax exemption provisions for Class I renewable energy sources, particularly focusing on solar photovoltaic systems. The bill repeals and replaces subdivision (57) of section 12-81, clarifying that installations for private residential use or on farms must occur after October 1, 2007, and that their estimated annual production should not exceed the estimated annual load for the location. It allows municipalities to abate up to 100% of property tax for certain renewable energy sources installed for commercial or industrial purposes, contingent on meeting specific criteria. The bill also introduces new requirements for exemption applications, including a filing deadline and a detailed written application outlining the estimated load and production of the energy source.

Furthermore, the bill establishes a new tax structure for solar photovoltaic systems effective from July 1, 2026, requiring owners to pay an annual tax based on their system's capacity. It includes provisions for tax exemptions for systems on state-owned land and brownfields, and allows municipalities to stabilize or freeze taxes for solar system owners. The bill also clarifies tax responsibilities for photovoltaic systems located in multiple municipalities and defines the components of a solar photovoltaic system for calculating its nameplate capacity. Key deletions from current law include specific dates and provisions regarding exemption applicability, while new definitions and tax structures are inserted to reflect the updated approach to taxing and assessing solar energy systems in the state.