Tax code for energy storage power supply

Can a taxpayer claim a production tax credit on energy storage technology?

The preamble to the proposed regulations suggests that there is a broader principle that allows a taxpayer to claim the ITC on energy storage technology that is co-located with a qualified facility (such as a wind facility) with respect to which the taxpayer claims the production tax credit under Section 45 (the “ PTC ”).

Is energy storage technology a dual use property?

In addition, the proposed regulations prospectively incorporate a modified version of the Dual Use Rule for other traditionally dual use property (other than energy storage technology), but reduce the “cliff” from 75% to 50%. As revised by the IRA, Section 48 includes energy storage technology in the definition of energy property.

What tax credits are available for energy projects in low-income communities?

In addition to the bonus for the Investment Tax Credit for projects in low-income communities, the Inflation Reduction Act: Provides a bonus credit of up to 10 percentage points for qualifying clean energy investments in energy communities.

What is the IRC section 45W refueling property credit?

The IRC Section 45W credit cannot exceed $7,500 for vehicles weighing less than 14,000 pounds and $40,000 for other vehicles. The IRA extends the IRC Section 30C alternative fuel refueling property credit of 30% of the cost of any qualified alternative fuel vehicle refueling property to those placed in service before January 1, 2033.

Are prevailing wage and apprenticeship requirements applicable to energy properties?

As a result, taxpayers should use caution in determining their compliance with prevailing wage and apprenticeship requirements, and their eligibility for the domestic content and energy community bonus credits, to ensure their determination is applied to the correct grouping of energy properties.