Frequently Asked Questions
Who is eligible for the Qualifying Advanced Energy Project Credit?
Must apply for and receive an allocation from the Secretary. Covers manufacturing of solar/wind equipment, fuel cells, energy storage, and critical material processing. 6% base rate if labor requirements are not met.
How does the Qualifying Advanced Energy Project Credit work?
A 30% investment tax credit (if wage/apprenticeship rules met) for re-equipping, expanding, or establishing facilities that produce renewable energy property, EVs, or grid modernization equipment.
What law authorizes the Qualifying Advanced Energy Project Credit?
The Qualifying Advanced Energy Project Credit is authorized under IRC §48C of the Internal Revenue Code (Title 26, United States Code).
Statutory Text — IRC §48C
Source: Internal Revenue Code, Title 26, United States Code
§ 48C. Qualifying advanced energy project credit(a) In generalFor purposes of section 46, the qualifying advanced energy project credit for any taxable year is an amount equal to 30 percent of the qualified investment for such taxable year with respect to any qualifying advanced energy project of the taxpayer.
(b) Qualified investment(1) In generalFor purposes of subsection (a), the qualified investment for any taxable year is the basis of eligible property placed in service by the taxpayer during such taxable year which is part of a qualifying advanced energy project.
(2) Certain qualified progress expenditures rules made applicableRules similar to the rules of subsections (c)(4) and (d) of section 46 (as in effect on the day before the enactment of the Revenue Reconciliation Act of 1990) shall apply for purposes of this section.
(3) LimitationThe amount which is treated as the qualified investment for all taxable years with respect to any qualifying advanced energy project shall not exceed the amount designated by the Secretary as eligible for the credit under this section.
(c) Definitions(1) Qualifying advanced energy project(A) In generalThe term “qualifying advanced energy project” means a project, any portion of the qualified investment of which is certified by the Secretary under subsection (e) as eligible for a credit under this section—(i) which re-equips, expands, or establishes an industrial or manufacturing facility for the production or recycling of—(I) property designed to be used to produce energy from the sun, water, wind, geothermal deposits (within the meaning of section 613(e)(2)), or other renewable resources,
(II) fuel cells, microturbines, or energy storage systems and components,
(III) electric grid modernization equipment or components,
(IV) property designed to capture, remove, use, or sequester carbon oxide emissions,
(V) equipment designed to refine, electrolyze, or blend any fuel, chemical, or product which is—(aa) renewable, or
(bb) low-carbon and low-emission,
(VI) property designed to produce energy conservation technologies (including residential, commercial, and industrial applications),
(VII) light-, medium-, or heavy-duty electric or fuel cell vehicles, as well as—(aa) technologies, components, or materials for such vehicles, and
(bb) associated charging or refueling infrastructure,
(VIII) hybrid vehicles with a gross vehicle weight rating of not less than 14,000 pounds, as well as technologies, components, or materials for such vehicles, or
(IX) other advanced energy property designed to reduce greenhouse gas emissions as may be determined by the Secretary,
(ii) which re-equips an industrial or manufacturing facility with equipment designed to reduce greenhouse gas emissions by at least 20 percent through the installation of—(I) low- or zero-carbon process heat systems,
(II) carbon capture, transport, utilization and storage systems,
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