Green Infrastructure | April 2, 2024

IRA-backed program commits $4 billion in tax credits for 100 green projects

Roodgally Senatus and Amy Cortese
ImpactAlpha Editor

Roodgally Senatus

ImpactAlpha Editor

Amy Cortese

The tax credits for more than 100 projects in 35 states are backed by the Qualifying Advanced Energy Project Credit (48C) program, which was expanded under the Inflation Reduction Act.

More than half of the $4 billion in credits will go towards clean energy manufacturing and recycling projects, including electric vehicles, nuclear, solar and wind energy, and energy storage. The rest will go to critical materials recycling and industrial decarbonization projects.

The program provides an investment tax credit of up to 30% of qualified investments for certified projects. The Department of Energy, which made the awards, did not name the recipients.

Coal country

Around $1.5 billion in tax credits will go to projects in former coal communities that are transitioning to renewable energy. The administration’s agenda “places direct emphasis on communities that have traditionally powered our nation for generations, helping ensure those communities reap the economic benefits of the clean energy transition,” said US energy secretary Jennifer Granholm.

Funding frenzy

The pace of IRA funding is picking up as the Biden administration races to deploy the historic climate resilience funds ahead of the looming presidential election. Last month, DOE announced $6 billion in matching grants for 33 industrial decarbonization demonstration projects spanning steel, aluminum and cement manufacturing and food, paper and pulp production.

The agency’s Loan Programs Office last week approved a $1.5 billion conditional loan guarantee to Holtec International to restart a nuclear power plant in Michigan, and $500 million for a low-carbon aluminum smelter being built by Century Aluminum.