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In December 2020, Congress extended the PTC and ITC – at the 2018 rate – for onshore projects starting construction in 2021. | In December 2020, Congress extended the PTC and ITC – at the 2018 rate – for onshore projects starting construction in 2021. | ||
In August 2022, they were similarly extended for onshore projects starting construction before January 1, 2025.<ref>https://www.congress.gov/bill/117th-congress/house-bill/5376/text</ref> The credit was reduced to one-fifth, however, unless a project pays prevailing wages and hires a certain number of apprentices (at least 1 if 4 or more employees, then 10% in 2022, 12.5% in 2023, and then 15%). The credit can be increased by 10% credit (20% for offshore) if all of the components and their materials are produced in the USA (unless that would increase the cost more than 25% or they are not available in sufficient quantity or quality). A further 10% increase is available for projects in brownfields or areas with at least 0.17% employment in or 25% of tax revenues from coal, oil, or natural gas and with unemployment at or above the national average or a closed coal mine or power plant (since 2000 or 2010, respectively). | In August 2022, they were similarly extended for onshore projects starting construction before January 1, 2025.<ref>https://www.congress.gov/bill/117th-congress/house-bill/5376/text</ref> The credit was reduced to one-fifth, however, unless a project pays prevailing wages and hires a certain number of apprentices (at least 1 if 4 or more employees, then 10% in 2022, 12.5% in 2023, and then 15%). The credit can be increased by 10% credit (20% for offshore) if all of the components and their materials are produced in the USA (unless that would increase the cost more than 25% or they are not available in sufficient quantity or quality). A further 10% increase is available for projects in brownfields or areas with at least 0.17% employment in or 25% of tax revenues from coal, oil, or natural gas and with unemployment at or above the national average or a closed coal mine or power plant (since 2000 or 2010, respectively). A ten percent increase is also available for projects in low-income or Indian communities or as part of low-income benefit project. | ||
It appears, however, that these provisions apply only to projects of less than 1 MW, or 5 MW in the case of low-income benefit. | |||
==Investment tax credit== | ==Investment tax credit== | ||
As an alternative, facilities eligible for the PTC can claim an “investment tax credit” (ITC), in which a projected value of the PTC over its 10 years (namely, 30% of the capital investment) is taken up front.<ref>http://programs.dsireusa.org/system/program/detail/658</ref> | As an alternative, facilities eligible for the PTC can claim an “investment tax credit” (ITC), in which a projected value of the PTC over its 10 years (namely, 30% of the capital investment) is taken up front.<ref>http://programs.dsireusa.org/system/program/detail/658</ref> | ||
In August 2022,<ref>https://www.congress.gov/bill/117th-congress/house-bill/5376/text</ref> the ITC was extended to projects beginning construction before January 1, 2035. The 6% ITC (at one-fifth) is reduced to 5.2% for projects beginning construction in 2033, and to 4.4% for projects beginning construction in 2034. | |||
==References== | ==References== |