26 U.S.C. § 48E
For purposes of section 46, the clean electricity investment credit for any taxable year is an amount equal to the applicable percentage of the qualified investment for such taxable year with respect to-
Subject to paragraph (3)-
In the case of any qualified facility which is not described in subclause (I) or (II) of clause (ii) and does not satisfy the requirements described in subclause (III) of such clause, the applicable percentage shall be 6 percent.
In the case of any qualified facility-
the applicable percentage shall be 30 percent.
Subject to paragraph (3)-
In the case of any energy storage technology which is not described in subclause (I) or (II) of clause (ii) and does not satisfy the requirements described in subclause (III) of such clause, the applicable percentage shall be 6 percent.
In the case of any energy storage technology-
the applicable percentage shall be 30 percent.
In the case of any qualified investment with respect to a qualified facility or with respect to energy storage technology which is placed in service within an energy community (as defined in section 45(b)(11)(B)), for purposes of applying paragraph (2) with respect to such property or investment, the applicable percentage shall be increased by the applicable credit rate increase.
For purposes of clause (i), the applicable credit rate increase shall be an amount equal to-
Rules similar to the rules of section 48(a)(12) shall apply.
For purposes of subsection (a), the qualified investment with respect to any qualified facility for any taxable year is the sum of-
For purposes of this section, the term "qualified property" means property-
For purposes of this section, the term "qualified facility" means a facility-
Rules similar to the rules of section 45Y(b)(1)(C) shall apply for purposes of this paragraph.
Rules similar to the rules of section 45Y(b)(2) shall apply for purposes of this paragraph.
The term "qualified facility" shall not include any facility for which-
is allowed under section 38 for the taxable year or any prior taxable year.
For purposes of this paragraph, the term "qualified interconnection property" has the meaning given such term in section 48(a)(8)(B).
The qualified investment with respect to any qualified facility for any taxable year shall not include that portion of the basis of any property which is attributable to qualified rehabilitation expenditures (as defined in section 47(c)(2)).
For purposes of this subsection, the terms "CO2e per KWh" and "greenhouse gas emissions rate" have the same meaning given such terms under section 45Y.
For purposes of subsection (a), the qualified investment with respect to energy storage technology for any taxable year is the basis of any energy storage technology placed in service by the taxpayer during such taxable year.
For purposes of this section, the term "energy storage technology" has the meaning given such term in section 48(c)(6) (except that subparagraph (D) of such section shall not apply).
Rules similar to the rules of subsections (c)(4) and (d) of section 46 (as in effect on the day before the date of the enactment of the Revenue Reconciliation Act of 1990) shall apply for purposes of subsection (a).
Rules similar to the rules of section 45(b)(3) shall apply.
Rules similar to the rules of section 48(a)(10) shall apply.
Rules similar to the rules of section 45(b)(8) shall apply.
In the case of a taxpayer making an election under section 6417 with respect to a credit under this section, rules similar to the rules of section 45Y(g)(12) shall apply.
The amount of the clean electricity investment credit under subsection (a) for any qualified investment with respect to any qualified facility or energy storage technology the construction of which begins during a calendar year described in paragraph (2) shall be equal to the product of-
The phase-out percentage under this paragraph is equal to-
For purposes of this subsection, the term "applicable year" has the same meaning given such term in section 45Y(d)(3).
In this section, the term "greenhouse gas" has the same meaning given such term under section 45Y(e)(2).
For purposes of section 50, if the Secretary determines that the greenhouse gas emissions rate for a qualified facility is greater than 10 grams of CO2e per KWh, any property for which a credit was allowed under this section with respect to such facility shall cease to be investment credit property in the taxable year in which the determination is made.
In the case of any applicable facility with respect to which the Secretary makes an allocation of environmental justice capacity limitation under paragraph (4)-
For purposes of this subsection-
The term "applicable facility" means any qualified facility-
A facility shall be treated as part of a qualified low-income residential building project if-
A facility shall be treated as part of a qualified low-income economic benefit project if at least 50 percent of the financial benefits of the electricity produced by such facility are provided to households with income of-
For purposes of subparagraphs (B) and (C), electricity acquired at a below-market rate shall not fail to be taken into account as a financial benefit.
For purposes of this subsection, the term "eligible property" means a qualified investment with respect to any applicable facility.
Not later than January 1, 2025, the Secretary shall establish a program to allocate amounts of environmental justice capacity limitation to applicable facilities. In establishing such program and to carry out the purposes of this subsection, the Secretary shall provide procedures to allow for an efficient allocation process, including, when determined appropriate, consideration of multiple projects in a single application if such projects will be placed in service by a single taxpayer.
The amount of environmental justice capacity limitation allocated by the Secretary under subparagraph (A) during any calendar year shall not exceed the annual capacity limitation with respect to such year.
For purposes of this paragraph, the term "annual capacity limitation" means 1.8 gigawatts of direct current capacity for each calendar year during the period beginning on January 1, 2025, and ending on December 31 of the applicable year (as defined in section 45Y(d)(3)), and zero thereafter.
If the annual capacity limitation for any calendar year exceeds the aggregate amount allocated for such year under this paragraph, such limitation for the succeeding calendar year shall be increased by the amount of such excess. No amount may be carried under the preceding sentence to any calendar year after the third calendar year following the applicable year (as defined in section 45Y(d)(3)).
If the annual capacity limitation for calendar year 2024 under section 48(e)(4)(D) exceeds the aggregate amount allocated for such year under such section, such excess amount may be carried over and applied to the annual capacity limitation under this subsection for calendar year 2025. The annual capacity limitation for calendar year 2025 shall be increased by the amount of such excess.
Paragraph (1) shall not apply with respect to any property which is placed in service after the date that is 4 years after the date of the allocation with respect to the facility of which such property is a part.
Any amount of environmental justice capacity limitation which expires under clause (i) during any calendar year shall be taken into account as an excess described in subparagraph (D)(i) (or as an increase in such excess) for such calendar year, subject to the limitation imposed by the last sentence of such subparagraph.
The Secretary shall, by regulations or other guidance, provide for recapturing the benefit of any increase in the credit allowed under subsection (a) by reason of this subsection with respect to any property which ceases to be property eligible for such increase (but which does not cease to be investment credit property within the meaning of section 50(a)). The period and percentage of such recapture shall be determined under rules similar to the rules of section 50(a). To the extent provided by the Secretary, such recapture may not apply with respect to any property if, within 12 months after the date the taxpayer becomes aware (or reasonably should have become aware) of such property ceasing to be property eligible for such increase, the eligibility of such property for such increase is restored. The preceding sentence shall not apply more than once with respect to any facility.
Not later than January 1, 2025, the Secretary shall issue guidance regarding implementation of this section.
1 So in original. Another closing parenthesis probably should precede the comma.
26 U.S.C. § 48E
EDITORIAL NOTES
REFERENCES IN TEXTThe date of the enactment of the Revenue Reconciliation Act of 1990, referred to in subsec. (d)(1), is the date of enactment of Pub. L. 101-508, which was approved Nov. 5, 1990.The Housing Act of 1949, referred to in subsec. (h)(2)(B)(i), is act July 15, 1949, ch. 338, 63 Stat. 413. Title V of the Act is classified generally to subchapter III (§1471 et seq.) of chapter 8A of Title 42, The Public Health and Welfare. For complete classification of this Act to the Code, see Short Title note set out under section 1441 of Title 42 and Tables.
STATUTORY NOTES AND RELATED SUBSIDIARIES
EFFECTIVE DATE Pub. L. 117-169, §13702(c), Aug. 16, 2022, 136 Stat. 1997, provided that: "The amendments made by this section [enacting this section and amending sections 46, 49, and 50 of this title] shall apply to property placed in service after December 31, 2024."
- Secretary
- The term "Secretary" means the Secretary of the Treasury or his delegate.
- taxable year
- The term "taxable year" means the calendar year, or the fiscal year ending during such calendar year, upon the basis of which the taxable income is computed under subtitle A. "Taxable year" means, in the case of a return made for a fractional part of a year under the provisions of subtitle A or under regulations prescribed by the Secretary, the period for which such return is made.
- taxpayer
- The term "taxpayer" means any person subject to any internal revenue tax.