U.S. Deputy Secretary of the Treasury Wally Adeyemo highlighted the significance of the Inflation Reduction Act in providing easier access to tax incentives for clean energy projects, stating, “Before the Inflation Reduction Act, it was more challenging for companies to access tax incentives to finance projects and deploy new clean power."
The IRS introduced the Energy Credits Online (ECO) portal to facilitate taxpayers in receiving elective payments, transferring clean energy credits, or claiming a CHIPS credit. According to the announcement, as of March 8, 2024, around 500 entities have registered and requested registration numbers for over 45,500 projects through the ECO portal.
More than 98% of the registered projects are focused on transferability, with a diverse range of credits being utilized, including the Investment Tax Credit, Production Tax Credit, Commercial Clean Vehicle Credit, and others. The majority of the projects are under the clean energy Investment Tax Credit (Section 48) and Production Tax Credit (Section 45), predominantly related to solar and wind facilities.
Entities filing for these credits can anticipate a payment within 45 days of the due date of their annual return, with the IRS issuing registration numbers on a rolling basis. The U.S. Department of the Treasury and the IRS have undertaken an extensive educational campaign to inform taxpayers about these new provisions, including hosting webinars and events that have attracted thousands of attendees.
The implementation of these key provisions under the Inflation Reduction Act is aimed at expanding the reach of clean energy tax credits, making it easier for various entities to benefit from incentives and contribute to the growth of the clean energy economy.
