What is Predominant Use Study?
According to the Texas statute, a predominant use study is a test to determine if more than 50% of the energy of each company meter is expended on services eligible for sales tax exemption on the electric or natural gas bill.
In order to determine if a company is eligible, we perform an on-site evaluation of the facility. Texas Utility Studies, Inc. utilizes our trained, insured personnel to undergo the assessment and obtain the necessary information at the facility as a basis for the predominant use study.
In Texas, if the qualifying usage is over 50% then the whole bill is eligible for the tax exemption. Our Texas licensed engineer examines and gives final approval to every predominant use study as required by the state. The engineer’s Texas seal certifies the study.
When Must the Study be Updated?
As directed by Texas law, the predominant use study must be updated if any of the following change:
- Business name
- Hours of equipment use
- Type of business or processes performed, especially if production usage decreases.
- Additions in the office or support areas.
- Any changes that may impact the percentage of the processing in a negative way should be re-examined.
What are the Benefits of the Predominant Use Study
- Refund of sales tax paid up to the past 48 months.
- Electricity or natural gas sales tax exemption
- Depending on predominant use study results, clients can create cost saving possibilities and improvements to their facility.
Don’t Waste Another Penny on Sales and Use Taxes
Our firm can help you eliminate and recover sales taxes on natural gas and electricity in many other states that have begun to use this economic incentive to attract and maintain business. We are familiar with the variations and have done studies that comply with the laws of other individual states. We remain cost effective and are very competitive. Let us offer your firm a quote.
Other Benefits Predominant Use Studies Have
Once a predominant use study has been commissioned, in addition to preparing the application, Texas Utility Studies, Inc. prepares a detailed report which forms the basis for a traditional energy audit and aids management in the following supplementary ways:
- Pinpoints locations of major energy costs
- Provides strategic potential cost saving opportunities
- Quantifies the energy usage of each piece of equipment, process, or cost center