Up for Grabs by Clean Energy Firms: $150 Million in Unused U.S. Tax Credits

The U.S. Departments of Energy and the Treasury has announced the availability of $150 million in Advanced Energy Manufacturing Tax Credits for clean energy and energy efficiency manufacturing projects across the United States. This funding represents remaining tax credits that were never fully utilized by previous awardees.

 In its initial round, the Section 48C Advanced Manufacturing Tax Credit—made available under the American Recovery Reinvestment Act of 2009—provided a 30 percent investment tax credit to 183 domestic clean energy manufacturing facilities, valued at $2.3 billion. The program’s goals are to fortify America’s global competitiveness in clean energy manufacturing, bolster the nation’s energy security, and creating new jobs and opportunities for U.S. workers.

“Since 2009, the Advanced Energy Manufacturing Tax Credit program has supported innovative American manufacturers that boost our nation’s competitiveness in the global race for clean energy,” said Energy Secretary Steven Chu. “These new investments will continue that momentum, supporting the President's commitment to American-made energy, increasing energy security, and creating jobs.”

“As the economy continues to heal, the President has been clear that we have to do everything we can to boost growth and job creation today and build a more sustainable foundation for tomorrow,” said Acting Secretary of the Treasury Neal S. Wolin. “Manufacturing the clean energy products of the future in America will create good, middle-class jobs right now and help lay the groundwork for the long-term resilience of our economy.”

According to the Obama Administration, over the past four years, the United States has more than doubled clean, renewable energy generation from wind, solar, and geothermal sources, and has strengthened its position as a global leader in the clean energy race. At the same time, the American manufacturing sector has begun to rebound—with 500,000 manufacturing jobs added since the beginning of 2010. The re-availability of this funding will help to continue and advance the progress to date.

The remaining tax credits will be allocated on a competitive basis. Projects will be assessed by the Department of Energy (DOE) based on the following criteria: commercial viability, domestic job creation, technological innovation, speed to project completion, and potential for reducing air pollution and greenhouse gas emissions. DOE also will consider additional factors, including diversity of geography, technology, and project size, and regional economic development. The IRS has posted the full solicitation, Notice 2013-12.

 Qualifying manufacturing facilities will include those that produce:

·         Solar, wind, geothermal, or other renewable energy equipment;

·         Electric grids and storage for renewables;

·         Fuel cells and micro-turbines;

·         Energy storage systems for electric or hybrid vehicles;

·         Carbon dioxide capture and sequestration equipment;

·         Equipment for refining or blending renewable fuels;

·         Equipment for energy conservation, including lighting and smart grid technologies; and

·         Other advanced energy property designed to reduce greenhouse gas emissions, which also may be eligible, as determined by the Secretary of the Treasury.

Among the statutorily specified review criteria are:

·         Greatest domestic job creation (direct and indirect);

·         Greatest net impact in avoiding or reducing air pollutants or emissions of greenhouse gases;

·         Lowest levelized cost of energy;

·         Greatest potential for technological innovation and commercial deployment; and

·         Shortest project time from certification to completion.

The application period for certification begins on February 7, 2013, and ends on July 23, 2013. More specifically, a concept paper for DOE consideration must be submitted by April 9, 2013. If after review of the concept paper DOE invites an applicant to submit an application for DOE recommendation, the application must be submitted by July 23, 2013. All timely submitted applications will be evaluated and ranked on their merit, regardless of when in the application period they are submitted.