Clocktower Place

Renewable Energy Tax Credits

 

Renewable Energy Tax Credits

We offer tax credit financing services for the following tax credits:

Federal Business Energy Investment Tax Credit

Federal Renewable Electricity Production Tax Credit

State Renewable Energy Tax Credits

Federal Business Energy Investment Tax Credits (ITC)

The American Recovery and Reinvestment Act of 2009 allows taxpayers eligible for the Federal Renewable Electricity Production Tax Credit (PTC) to take the Federal Business Energy Investment Tax Credit (ITC) or to receive a grant from the U.S. Treasury Department instead of taking the PTC for new installations.

Credits are available for eligible renewable energy generating systems placed in service on or before December 31, 2016 including solar, fuel cells, small wind turbines, geothermal systems, microturbines and combined heat and power (CHP):

Solar. The credit is equal to 30% of qualified expenditures, with no maximum credit. Eligible solar energy property includes equipment that uses solar energy to generate electricity, to heat or cool (or provide hot water for use in) a structure, or to provide solar process heat. Hybrid solar lighting systems, which use solar energy to illuminate the inside of a structure using fiber-optic distributed sunlight, are eligible. Passive solar systems and solar pool-heating systems are not eligible.

Fuel Cells. The credit is equal to 30% of expenditures, with no maximum credit. However, the credit for fuel cells is capped at $1,500 per 0.5 kilowatt (kW) of capacity. Eligible property includes fuel cells with a minimum capacity of 0.5 kW that have an electricity-only generation efficiency of 30% or higher. (Note that the credit for property placed in service before October 4, 2008, is capped at $500 per 0.5 kW.)

Small Wind Turbines. The credit is equal to 30% of qualified expenditures, with no maximum credit for small wind turbines placed in service after December 31, 2008. Eligible small wind property includes wind turbines up to 100 kW in capacity.

Geothermal Systems. The credit is equal to 10% of expenditures, with no maximum credit limit stated. Eligible geothermal energy property includes geothermal heat pumps and equipment used to produce, distribute or use energy derived from a geothermal deposit. For electricity produced by geothermal power, equipment qualifies only up to, but not including, the electric transmission stage. For geothermal heat pumps, this credit applies to eligible property placed in service after October 3, 2008.

Microturbines. The credit is equal to 10% of expenditures, with no maximum credit limit stated. The credit for microturbines is capped at $200 per kW of capacity. Eligible property includes microturbines up to two megawatts (MW) in capacity that have an electricity-only generation efficiency of 26% or higher.

Combined Heat and Power (CHP). The credit is equal to 10% of expenditures, with no maximum limit stated. Eligible CHP property generally includes systems up to 50 MW in capacity that exceed 60% energy efficiency, subject to certain limitations and reductions for large systems. The efficiency requirement does not apply to CHP systems that use biomass for at least 90% of the system's energy source, but the credit may be reduced for less-efficient systems. This credit applies to eligible property placed in service after October 3, 2008.

In general, the original use of the equipment must begin with the taxpayer, or the system must be constructed by the taxpayer. The equipment must also meet any performance and quality standards in effect at the time the equipment is acquired. The energy property must be operational in the year in which the credit is first taken.