On June 14th, 2023, the IRS released the unpublished proposed rules to address questions and comments on application of the Inflation Reduction Act of 2022 (IRA), and they will be officially published June 21, 2023. The proposed rules will assist developers who are leveraging tax credits to accelerate the deployment of clean energy projects. As an energy developer, Pressure Corp sees potential in the proposed rules for elective payment elections and the transfer of credits established by the IRA.
A few of the 12 credits addressed we believe are most impacted:
Investment Tax Credits
Production Tax Credits
Advanced Manufacturing Credits
Carbon Oxide Sequestration
The IRS clarifications focus on procedures to claim the tax credits defined in the IRA. A clearer path has been established to increase confidence for the first deals that take advantage of IRA tax credits. The proposed rules significantly reduce the burden associated with tax equity partnerships that are currently required to monetize tax credits for clean energy projects.
Pressure Corp has compiled the sections of the IRS notice that will have the highest impact for clean energy developers and their partners.