– The Inflation Reduction Act’s Qualifying Advanced Energy Project Tax Credit is distributing $4 billion in credits for over 100 projects across 35 states aimed at accelerating domestic clean energy manufacturing and reducing greenhouse gas emissions at industrial facilities.
– At least $1.5 billion of the $4 billion tax credits will support projects in historic energy communities, such as closed coal mines or coal plants.
– Round 1 of the program allocated $2.7 billion for clean energy manufacturing and recycling projects, $800 million for critical materials recycling, processing, and refining, and $500 million for industrial decarbonization projects.
The Inflation Reduction Act’s Qualifying Advanced Energy Project Tax Credit (48C) will distribute $4 billion in credits for over 100 projects across 35 states to accelerate domestic clean energy manufacturing and reduce greenhouse gas emissions. $1.5 billion will support projects in historic energy communities with closed coal mines or coal plants. The program provides an investment tax credit of up to 30% of qualified investments for certified projects meeting wage and apprenticeship requirements, with DOE partnering with Treasury and IRS to implement it.
Round 1 of the program received significant interest, with nearly $42 billion in tax credits requested across all project categories, including $13.5 billion for projects in designated energy communities. Clean energy manufacturing and recycling projects received the largest allocation of $2.7 billion, followed by critical materials recycling and industrial decarbonization projects.
Selected projects will need to be certified within two years of submission to the portal and placed in service within an additional two years. The names of organizations with certified projects and the amount of their allocation will be published, but prior to certification, identifying information will not be shared without consent. Treasury and IRS will issue a notice for the second round of the program in the coming months, with concept paper submissions expected this summer.