The U.S. Department of Energy (DOE), the U.S. Department of Treasury and the IRS have authorized $4 billion in tax credits for 100 domestic projects aimed at accelerating renewable manufacturing at industrial facilities.
The agencies are partnering to implement the Qualifying Advanced Energy Project Tax Credit (48C) funded by the Inflation Reduction Act. At least $4 billion of the tax credit’s total $10 billion will be allocated for projects in designated §48C energy communities, with closed coal mines or coal plants.
The program received significant interest in its first round, say the agencies. Projects focused on clean energy manufacturing and recycling are set to receive $2.7 billion in tax credits. Those focused on critical materials recycling and refining are expected to receive $800 million, while projects centered around industrial decarbonization are slated for $500 million.
For selected projects to receive the tax credit, information will need to be submitted to the 48C portal within two years to certify the project. Within an additional two years following project certification, the project must be placed in service.
“From direct grants to historic tax credits, the president’s Investing in America agenda is making the nation an irresistible place to invest in clean energy manufacturing,” says U.S. Secretary of Energy Jennifer M. Granholm.
“The president’s agenda places direct emphasis on communities that have traditionally powered our nation for generations, helping ensure those communities reap the economic benefits of the clean energy transition and continue to play a leading role in building up the next wave of energy sources.”
The Treasury and IRS will issue a notice for the second round of the program in the coming months, with the concept paper submission window anticipated this summer.
