$2.3 billion in tax credits to manufacturers of clean energy equipment
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PrintAuthorized by the Recovery Act, a new program was announced that will provide $2.3 billion in tax credits to manufacturers of advanced clean energy equipment. The new program was announced by the Department of the Treasury (DOT) and the Department of Energy (DOE). The main goals of the tax credits are to increase economic development and set the country on the path to energy independence.
The Recovery Act created a new tax credit program to provide an investment tax credit of 30 percent for facilities that manufacture particular types of energy equipment. Qualifying manufactures will produce solar, wind, and geothermal energy equipment; fuel cells, microturbines, and batteries; electric cars; electric grids to support the transmission of renewable energy; energy conservation technologies; and equipment that captures and sequesters carbon dioxide or reduces greenhouse gas emissions.
The manufacturing tax credit is capped at $2.3 billion, and credits are available for two years or until the cap is reached. Companies can expect to receive payments within 180 days of filing for the credit.
“This program will help encourage innovation in design of clean energy technologies,” said Treasury Secretary Tim Geithner. “This partnership between Treasury and Energy adds an important new dimension to the incentives created in the Recovery Act to increase US manufacturing output, improve energy efficiency, and develop alternative sources of energy.”
Said Energy Secretary Steven Chu: “These tax credits will help create thousands of high quality manufacturing jobs in some of the highest growth segments of the economy. This is an opportunity to develop our global leadership in clean energy manufacturing and build a secure, sustained base of jobs for America’s workers.”
The application period opens August 14, 2009. Preliminary applications are due to DOE September 16, 2009, followed by final applications being due to DOE and IRS on October 16, 2009.
Projects must be completed within 4 years of their tax credit acceptance. Eligible investment credits cover future expenditures and do not award past investment.
To view the program summary and guidance for applying for the tax credit, please visit the Advanced Energy Manufacturing Tax Credit (48C) page.
Tax programs have been provided in the past for the development of renewable energy - in 2006, approximately $550 million in renewable energy tax credits were provided to 450 businesses. In July, DOT and DOE announced the availability of a payment in lieu of tax credits for facilities that produce renewable energy, a program that they expect to result in more than $3 billion of stimulus for energy development in rural and urban communities.
