Renewable Electricity Production Tax Credit (PTC)
|Incentive Type:||Corporate Tax Credit|
|Governing Body:||U.S. Internal Revenue Service|
|What’s it worth?:||$0.023/kWh|
The tax credit amount for participants is between $0.011 per kWh to $0.023 per kWh. The amount may be adjusted for inflation according to the IRS inflation adjustment factor each year. Qualifying technologies include:
- Closed-Loop Biomass
- Geothermal Energy
- Landfill Gas
- Municipal Solid Waste
- Qualified Hydroelectric
- Marine and Hydrokinetic
The tax credit may typically be claimed for 10 years after the technology has been implemented; some technologies only qualify for a tax credit duration of five years. To claim the tax credit participants must file an IRS form 8835 and form 3800. Unused credits may be carried forward for up to 20 years.
Eligible projects have commenced construction prior to January 1, 2015. To identify commenced construction according to the IRS participants must use a “physical work” test or a 5% safe harbor; both methods require continuous progress towards completion after beginning the project. Eligible systems have a capacity rating of 150 kW or higher for Marine and Hydrokinetic technologies and Open-Loop Biomass Facilities.