Qualifying Advanced Energy Project Credit
| Type | Program |
|---|---|
| Sponsor Organization | Office of Manufacturing and Energy Supply Chains |
| Top Organization | N/A |
| Creation Legislation | Inflation Reduction Act |
| Website | Website |
| Purpose | To incentivize investments in clean energy manufacturing and industrial decarbonization projects through tax credits. It aims to expand domestic clean energy manufacturing capabilities and reduce greenhouse gas emissions.[1] |
| Program Start | 2023 |
| Initial Funding | $10 billion[2] |
| Duration | Indefinite |
| Historic | Yes |
Qualifying Advanced Energy Project Credit (48C) is designed to incentivize investments in clean energy manufacturing and industrial decarbonization projects through tax credits. It aims to expand domestic clean energy manufacturing capabilities, reduce greenhouse gas emissions, and support energy communities by allocating credits for qualified investments in advanced energy projects.[3]
Goals
- Support clean energy manufacturing and recycling projects.[4]
- Promote industrial decarbonization by incentivizing projects that significantly reduce greenhouse gas emissions.
- Allocate at least 40% of the credits to projects in energy communities to revitalize these areas.
Organization
The program is managed by the Office of Manufacturing and Energy Supply Chains (MESC) within the U.S. Department of Energy, in collaboration with the Internal Revenue Service (IRS). The leadership role is held by the Director of MESC.
Partners
History
The Qualifying Advanced Energy Project Credit was initially authorized under the American Recovery and Reinvestment Act of 2009 but was significantly expanded through the Inflation Reduction Act in 2022. This expansion included a new allocation of $10 billion in credits, focusing on clean energy supply chains and energy communities.[5] The first allocation round was announced in 2023, followed by a second round in 2024, with significant projects aimed at clean technology manufacturing and industrial decarbonization.
Funding
The program was initially funded with $10 billion for credit allocations under the Inflation Reduction Act.[6] This funding does not expire as it is structured for ongoing allocations, with the IRS and DOE managing the distribution of credits over time. The credit can be claimed at a base rate of 6% or 30% if prevailing wage and apprenticeship requirements are met.
Implementation
The implementation involves:
- A two-phase application process where applicants first submit a concept paper followed by a full application if encouraged.
- DOE evaluates projects based on their potential impact on clean energy manufacturing, emissions reduction, and community benefits.
- Internal Revenue Service allocates the credit based on DOE recommendations, with specific criteria for energy communities and critical technology areas.
There's no defined end date for the program; it continues until the $10 billion in credits is fully allocated or additional funding is legislated.
Related
External links
- https://www.energy.gov/mesc/qualifying-advanced-energy-project-credit
- https://www.irs.gov/credits-deductions/qualifying-advanced-energy-project-credit
- wikipedia:Qualifying Advanced Energy Project Credit
Social media
- No specific social media accounts for this program; follow the Department of Energy for updates.
References
- ↑ "Qualifying Advanced Energy Project Credit". https://www.energy.gov/mesc/qualifying-advanced-energy-project-credit. Retrieved January 30, 2025.
- ↑ "Qualifying Advanced Energy Project Credit". https://www.irs.gov/credits-deductions/qualifying-advanced-energy-project-credit. Retrieved January 30, 2025.
- ↑ "Qualifying Advanced Energy Project Credit". https://www.energy.gov/mesc/qualifying-advanced-energy-project-credit. Retrieved January 30, 2025.
- ↑ "Qualifying Advanced Energy Project Credit". https://www.energy.gov/mesc/qualifying-advanced-energy-project-credit. Retrieved January 30, 2025.
- ↑ "Qualifying Advanced Energy Project Credit". https://www.irs.gov/credits-deductions/qualifying-advanced-energy-project-credit. Retrieved January 30, 2025.
- ↑ "Qualifying Advanced Energy Project Credit". https://www.irs.gov/credits-deductions/qualifying-advanced-energy-project-credit. Retrieved January 30, 2025.