Performing Predominant Use Study Energy Audit in Texas

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Are you one of the many business owners who don't take advantage of the favorable tax laws regarding energy usage? You may qualify for hundreds of dollars in tax exemptions every month.

Here is what you get...

• Recover a load of cash from your electricity and gas bills.
• Bypass unnecessary sales taxes on your energy consumption, which are sometimes buried in your energy changes.
• Receive up to 48 months of paid taxes on energy bills.

I conduct Predominant Use Study. It is an energy study that is required in Texas for sales tax exemption on Electricity bills and Natural Gas bills.  Example businesses that may qualify for sales tax  exemption are :

• manufacturing companies, donuts shops, bakeries, print shops, trophy shops, machine shops, asphalt manufacturers and many others
• Common areas of multifamily residentials
• Common areas of Home Owners Associations (HOAs) 

Each meter requires 1 predominant use study.  The meter is qualified if the study determines that over 50% of energy is consumed by the manufacturing processes and areas. If qualified, I provide your energy service providers with my report and a state sales tax exemption certificate per meter.  I recover, for you, the paid sales tax in the last 48 months.  It is a one-time study to make your monthly electric and gas bills tax free. 

I perform Predominant Use Study per Texas State tax Rule 3.295 Natural Gas and Electricity and Administrative Tax Code 151.318. 

Here is an Excerpt from tax rule 3.295:

"Determining predominant use: utility studies. 

(1) A person claiming a sales tax exemption because  the predominant use of natural gas or electricity purchased through  a single meter is for processing, manufacturing, fabricating, or another  nontaxable use must have a natural gas or electricity utility study  performed to establish the predominant exempt use of the natural gas  or electricity. 

(A) The study must list all uses of the utility, both  exempt and taxable, the times of usage, the energy used, whether the  use was taxable or exempt, and the percentage of exempt use of the  natural gas or electricity as determined by the study.

(B) Twelve consecutive months of utility usage must  be a part of the study. 

(C) The kilowatt rating or BTU rating, duty factor,  where needed for cycling equipment, and electrical or natural gas  computations must be certified by a registered engineer or a person  with an engineering degree from an accredited engineering college.

(D) The owner of the business must certify that all  items using natural gas or electricity (depending on which utility  is covered by the study) are listed and that the hours of use for  each item are correct. The certification of both the engineer and  the owner must appear on the face of the study.  

(E) If a person appoints an agent to act on its behalf,  the person must execute a power of attorney clearly stating the agent  is attempting to qualify the principal for a sales tax exemption. 

(2) A person in business less than 12 consecutive months  may still apply for a sales tax exemption if a registered engineer  or a person with an engineering degree performs a natural gas or electric  utility study based upon projected uses of the natural gas or electricity  which shows the predominant use to be exempt. A person claiming an  exemption based upon projected use must be able to support the claimed  exemption with a study of actual use after 12 consecutive months of  operation if requested by the comptroller.

(3) A natural gas or electric utility study must be  completed and on file at the location of the person claiming the exemption  at the time an exemption certificate is submitted to the utility company.  Without the study, the claim for exemption will be presumed to be  invalid.

(4) Persons obtaining a sales tax refund from a utility  company without a valid study will be assessed tax, penalty, and interest  by the comptroller on the full amount of the refund, if the exemption  is not proved."