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Predominant Use Studies
In the
state of Texas, companies that use more than 50 percent of their
electricity in the manufacturing, processing, or fabricating of products
for resale may apply for a sales tax exemption. The sales tax exemption
applies to all electricity purchased through a single point of delivery
as long as the electricity is predominantly used to manufacture,
process, or fabricate the product. A Predominant Use Study is required
to certify that more than 50 percent of electricity or natural gas
purchased is used to perform the tax-exempt activities.
If your facility qualifies, 3E Energy will provide the
documentation necessary to apply for the sales tax exemption.
Our professional
engineers will perform a thorough
audit of your facility including:
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Review existing electrical
and gas service and utility
metering for your site
-
Perform an on-site inventory
of all existing electrical
or gas operated equipment at
your facility
-
Communicate with your
facilities personnel
concerning plant operation
and equipment utilization
-
Gather and review past
monthly electric and gas
usage for your site
-
Develop Predominant Use
Study documentation
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Qualify equipment as tax
exempt or non-exempt
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Prepare energy usage
calculations based upon
equipment run-hours,
loading, and nameplate data
-
Prepare a Predominant Use
Study document summarizing
the percentage of
electricity and gas used in
the manufacturing process
including a list of
equipment
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Provide a Sales Tax
Exemption form and help
coordinate processing the
forms necessary to apply for
sales tax exemption and
request for refunds if
appropriate.
Benefits
- Cost Savings - If your
facility qualifies, you will no longer be required to pay
sales tax on electricity or gas purchased at your site.
Also, your business may qualify for a sales tax refund for
up to the previous four years, if sales taxes were paid
during that period and your business would have qualified
for an exemption.
- Documentation - We will
provide the necessary documentation to support your claims
in the event your business is audited by the state of Texas
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