The U.S. Department of the Treasury and the Department of Energy have announced new guidance on the Inflation Reduction Act programs aimed at boosting manufacturing and clean energy investments in coal communities. The Biden-Harris Administration revealed plans for a $6 billion tax credit allocation round to support clean energy supply chains and advanced energy projects, with a significant portion earmarked for historic energy communities impacted by coal-related closures.
Deputy Secretary of the Treasury Wally Adeyemo emphasized the importance of driving investments in clean energy to benefit overlooked communities, stating, "President Biden’s economic agenda ensures all communities benefit from the growth of the clean energy economy."
Deputy Secretary of Energy David Turk highlighted the broader impact of the initiative, stating, "Every community can benefit from President Biden’s agenda to Invest in America through the revitalization of domestic manufacturing, the strengthening of domestic clean energy supply chains, and the modernization of our nation’s industrial sector."
John Podesta, Senior Advisor to the President for International Climate Policy, hailed the Qualifying Advanced Energy Project Credit program as a game-changer for clean energy investment, stating, "This credit will help companies tap the talent and innovative potential of the energy communities and workers who have powered our nation for more than a century."
The Inflation Reduction Act has provided $10 billion in funding for the Qualifying Advanced Energy Project Credit program, renewing and expanding a tax credit initially created in 2009. A significant portion of the funding is reserved for projects in communities impacted by coal-related closures, aiming to incentivize clean energy manufacturing, industrial decarbonization, and critical materials processing.
The program has garnered substantial interest, with Round 1 allocating $4 billion, including funds for projects in energy communities affected by coal mine or plant closures. Round 2 of the program, with a total allocation of up to $6 billion, will prioritize projects in these energy communities, with applications opening in May 2024.
Interested parties can apply for Round 2 by submitting concept papers outlining their proposed projects. The Department of Energy will evaluate applications based on criteria such as commercial viability, greenhouse gas emissions impacts, and community engagement. The application portal for Round 2 will open by May 28th, 2024, with a deadline for concept paper submissions set for the 30th day after the portal opens.
For more information on the Qualifying Advanced Energy Project Credit program and to access resources for potential applicants, visit the Department of Energy’s website. A joint informational webinar will also be held in May to provide further details for interested parties.
