26 U.S.C. § 48E: Clean electricity investment credit

any qualified facility, and any energy storage technology. 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. with a maximum net output of less than 1 megawatt (as measured in alternating current), the construction of which begins prior to the date that is 60 days after the Secretary publishes guidance with respect to the requirements of paragraphs (3) and (4) of subsection (d), or satisfies the requirements of subsection (d)(3), and with respect to the construction of such facility, satisfies the requirements of subsection (d)(4), 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. with a capacity of less than 1 megawatt, the construction of which begins prior to the date that is 60 days after the Secretary publishes guidance with respect to the requirements of paragraphs (3) and (4) of subsection (d), or satisfies the requirements of subsection (d)(3), and with respect to the construction of such property, satisfies the requirements of subsection (d)(4), 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), as applied without regard to clause (iv) thereof), 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. in the case of any qualified investment with respect to a qualified facility described in paragraph (2)(A)(i) or with respect to energy storage technology described in paragraph (2)(B)(i), 2 percentage points, and in the case of any qualified investment with respect to a qualified facility described in paragraph (2)(A)(ii) or with respect to energy storage technology described in paragraph (2)(B)(ii), 10 percentage points. In the case of any qualified investment with respect to any qualified facility or energy storage technology the construction of which begins before June 16, 2025 , 40 percent (or, in the case of a qualified facility which is an offshore wind facility, 20 percent). In the case of any qualified investment with respect to any qualified facility or energy storage technology the construction of which begins on or after June 16, 2025 , and before January 1, 2026 , 45 percent (or, in the case of a qualified facility which is an offshore wind facility, 27.5 percent). In the case of any qualified investment with respect to any qualified facility or energy storage technology the construction of which begins during calendar year 2026, 50 percent (or, in the case of a qualified facility which is an offshore wind facility, 35 percent). In the case of any qualified investment with respect to any qualified facility or energy storage technology the construction of which begins after December 31, 2026 , 55 percent. the basis of any qualified property placed in service by the taxpayer during such taxable year which is part of a qualified facility, plus in connection with a qualified facility which has a maximum net output of not greater than 5 megawatts (as measured in alternating current), and placed in service during the taxable year of the taxpayer, and properly chargeable to capital account of the taxpayer. tangible personal property, or other tangible property (not including a building or its structural components), but only if such property is used as an integral part of the qualified facility, with respect to which depreciation (or amortization in lieu of depreciation) is allowable, and the construction, reconstruction, or erection of which is completed by the taxpayer, or which is acquired by the taxpayer if the original use of such property commences with the taxpayer. which is used for the generation of electricity, which is placed in service after December 31, 2024 , and for which the anticipated greenhouse gas emissions rate (as determined under subparagraph (B)(ii)) is not greater than zero. 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. a renewable electricity production credit determined under section 45, an advanced nuclear power facility production credit determined under section 45J, a carbon oxide sequestration credit determined under section 45Q, a zero-emission nuclear power production credit determined under section 45U, a clean electricity production credit determined under section 45Y, an energy credit determined under section 48, or a qualifying advanced coal project credit under section 48A, 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)). The terms “qualified facility” and “qualified interconnection property” shall not include any facility or property the construction, reconstruction, or erection of which begins after December 31, 2025 , if the construction, reconstruction, or erection of such facility or property includes any material assistance from a prohibited foreign entity (as defined in section 7701(a)(52)). 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). The term “energy storage technology” shall not include any property the construction of which begins after December 31, 2025 , if the construction of such property includes any material assistance from a prohibited foreign entity (as defined in section 7701(a)(52)). 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. a specified foreign entity (as defined in section 7701(a)(51)(B)), or a foreign-influenced entity (as defined in section 7701(a)(51)(D), without regard to clause (i)(II) thereof). In the case of a taxpayer for which section 7701(a)(51)(D)(i)(II) is determined to apply for any taxable year, no credit shall be determined under subsection (a) for such taxable year if such determination relates to a qualified facility described in subsection (b)(3) or energy storage technology described in subsection (c)(2). the amount of the credit determined under subsection (a) without regard to this subsection, multiplied by the phase-out percentage under paragraph (2). for any qualified investment with respect to any qualified facility or energy storage technology the construction of which begins during the first calendar year following the applicable year, 100 percent, for any qualified investment with respect to any qualified facility or energy storage technology the construction of which begins during the second calendar year following the applicable year, 75 percent, for any qualified investment with respect to any qualified facility or energy storage technology the construction of which begins during the third calendar year following the applicable year, 50 percent, and for any qualified investment with respect to any qualified facility or energy storage technology the construction of which begins during any calendar year subsequent to the calendar year described in subparagraph (C), 0 percent. For purposes of this subsection, the term “applicable year” has the same meaning given such term in section 45Y(d)(3). This section shall not apply to any qualified property placed in service by the taxpayer after December 31, 2027 , which is part of an applicable facility. uses wind to produce electricity (within the meaning of such term as used in section 45(d)(1), as determined without regard to any requirement under such section with respect to the date on which construction of property begins), or uses solar energy to produce electricity (within the meaning of such term as used in section 45(d)(4), as determined without regard to any requirement under such section with respect to the date on which construction of property begins). This paragraph shall not apply with respect to any energy storage technology which is placed in service at any applicable facility. 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 CO 2 e 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 a facility described in subclause (I) of paragraph (2)(A)(iii) and not described in subclause (II) of such paragraph, 10 percentage points, and in the case of a facility described in subclause (II) of paragraph (2)(A)(iii), 20 percentage points, and the environmental justice capacity limitation allocated to such facility, bears to the total megawatt nameplate capacity of such facility, as measured in direct current. which is not described in section 45Y(b)(2)(B), which has a maximum net output of less than 5 megawatts (as measured in alternating current), and is located in a low-income community (as defined in section 45D(e)) or on Indian land (as defined in section 2601(2) of the Energy Policy Act of 1992 ( 25 U.S.C. 3501(2) )), or is part of a qualified low-income residential building project or a qualified low-income economic benefit project. such facility is installed on a residential rental building which participates in a covered housing program (as defined in section 41411(a) of the Violence Against Women Act of 1994 ( 34 U.S.C. 12491(a)(3) ), 1 a housing assistance program administered by the Department of Agriculture under title V of the Housing Act of 1949, a housing program administered by a tribally designated housing entity (as defined in section 4(22) of the Native American Housing Assistance and Self-Determination Act of 1996 ( 1 So in original. Another closing parenthesis probably should precede the comma. 25 U.S.C. 4103(22) )) or such other affordable housing programs as the Secretary may provide, and the financial benefits of the electricity produced by such facility are allocated equitably among the occupants of the dwelling units of such building. less than 200 percent of the poverty line (as defined in section 36B(d)(3)(A)) applicable to a family of the size involved, or less than 80 percent of area median gross income (as determined under section 142(d)(2)(B)). 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. No credit shall be determined under this section for any qualified investment during the taxable year with respect to property described in paragraph (1) or (4) of section 25D(d) (as applied by substituting “lessee” for “taxpayer”) if the taxpayer rents or leases such property to a third party during such taxable year. subsection (b)(3)(A) shall be applied without regard to clause (iii) thereof, for purposes of subsection (a)(1), the applicable percentage shall be 30 percent and such percentage shall not be increased or otherwise adjusted by any other provision of this section, and subsection (g) shall not apply. Not later than January 1, 2025 , the Secretary shall issue guidance regarding implementation of this section.