| Incentive Type: |
Corporate Tax Credit |
| Eligible Renewable/Other Technologies: |
Landfill Gas, Wind, Biomass, Hydroelectric, Geothermal Electric, Municipal Solid Waste, Refined Coal, Indian Coal, Small Hydroelectric |
| Applicable Sectors: |
Commercial, Industrial |
| Amount: |
1.9¢/kWh for wind, geothermal, closed-loop biomass; 1.0¢/kWh for others. Applies to first 10 years of operation. |
| Website: |
http://www.irs.gov/pub/irs-pdf/f8835.pdf |
| Authority 1: |
26 USC § 45 |
| Date Enacted: |
1992 |
| Authority 2: |
The Working Families Tax Relief Act of 2004 (H.R. 1308) |
| Date Enacted: |
10/4/2004 |
| Effective Date: |
1/1/2004 |
| Expiration Date: |
12/31/2005 |
| Authority 3: |
American Jobs Creation Act of 2004 (H.R. 4520) -- Sec. 710 |
| Date Enacted: |
10/22/2004 |
| Effective Date: |
varies by technology |
| Expiration Date: |
12/31/2008 for refined coal; 12/31/05 for others |
| Authority 4: |
Energy Policy Act of 2005 (Section 1301) |
| Date Enacted: |
8/8/2005 |
| Effective Date: |
8/8/2005 |
| Expiration Date: |
1/1/2008 for renewables |
| Authority 5: |
The Tax Relief and Health Care Act of 2006 (H.R. 6111) |
| Expiration Date: |
12/31/2008 |
The Renewable Electricity Production Credit (REPC) is a per kilowatt-hour tax credit for electricity generated by qualified energy resources. Enacted as part of the Energy Policy Act of 1992, the credit expired at the end of 2001, and was subsequently extended in March 2002 as part of the Job Creation and Worker Assistance Act of 2002 (H.R. 3090). The tax credit then expired at the end of 2003 and was not renewed until October 4, 2004, as part of H.R. 1308, the Working Families Tax Relief Act of 2004, which extended the credit through December 31, 2005. The Energy Policy Act of 2005 (H.R. 6) modified the credit and extended it through December 31, 2007. In December 2006, the credit was extended for yet another year (through December 31, 2008) by Section 207 of the Tax Relief and Health Care Act of 2006 (H.R. 6111).
Section 710 of the "American Jobs Creation Act of 2004" (H.R. 4520), expanded REPC to include additional eligible resources -- geothermal energy, open-loop biomass, solar energy, small irrigation power, landfill gas, municipal solid waste combustion, and refined coal -- in addition to the formerly eligible wind energy, closed-loop biomass, and poultry-waste energy resources. The Energy Policy Act of 2005 (EPAct 2005) further expanded the credit to certain hydropower facilities and Indian coal (coal reserves owned by an Indian tribe or were held in trust by the U.S. for the benefit of an Indian tribe). Note that as a result of EPAct 2005, solar facilities placed into service after December 31, 2005, are no longer eligible for this incentive.
REPC now applies to the following resources:
- wind
- closed-loop biomass
- open-loop biomass
- geothermal energy
- small irrigation power (150 kW - 5 MW)
- municipal solid waste
- landfill gas
- refined coal
- hydropower
- Indian coal
The REPC provides a tax credit of 1.5 cents/kWh, adjusted annually for inflation, for wind, closed-loop biomass and geothermal. Currently, the REPC for these technologies is 1.9 cents/kWh. Electricity from open-loop biomass, small irrigation hydroelectric, landfill gas, municipal solid waste resources, and hydropower receive half that rate -- currently 1.0 cent/kWh.
The duration of the credit is 10 years. However, open-loop biomass, geothermal, small irrigation hydro, landfill gas, and municipal solid waste combustion facilities placed into service after 10/22/2004 and before enactment of the Energy Policy Act of 2005 (8/8/2005) are eligible for the credit for a five-year period. Refined-coal facilities will receive $4.375 per ton (indexed for inflation) for a 10-year term. Indian coal production facilities will receive an increase in tax credit during the 7-year period beginning January 1, 2006, in the amount of $1.50/ton through 2009, and $2.00/ton after 2009.
Note, however, that owners of geothermal projects who claim the federal business energy tax credit may not also claim this production tax credit.
A business can take the credit by completing Form 8835, "Renewable Electricity Production Credit," and Form 3800, "General Business Credit." |
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How You Can Help
U.S. Federal Action Alert - S. 673 7 H.R. 1772
WRITE YOUR SENATORS AND URGE THEM
TO COSPONSOR S. 673
The "Rural Wind Energy Development Act " (S. 673) would provide $1,500 per one-half kilowatt of capacity for small wind systems. This bill would make the credit available for 5 years for all wind systems under 100 kilowatts (kW) of capacity, and there is no cap on the amount of the credit granted per system
S. 673: Send Letter to Senator
H.R. 1772: Send Letter to Representative
Loans and Grants through Farm Bill Section 9006 |
The U.S. Department of Agriculture announced the availability of $176.5 million in loan guarantees and $11.4 million in grants to support investments in renewable energy and energy efficiency improvements by agricultural producers and small businesses.
Loan guarantees cover up to 50 percent of a project's cost, not to exceed $10 million. Grants cover up to 25% of the cost for renewable systems that are used for agricultural or small rural business use.
Applications for grants must be postmarked no later than May 18, 2007. The deadline for submitting loan applications as well as for loan and grant combinations is July 2, 2007.
Sample Small Wind Technical Application:
In order to use the simplified grant application the total project costs must be $200,000 or less and the turbine size must be 100 kW or less.
 Link to NOFA:
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