The U.S. Department of the Treasury and the IRS have released final rules and guidance for the Section 48E(h) Clean Electricity Low-Income Communities Bonus Credit Amount Program. This initiative aims to reduce home energy costs and encourage clean energy investments in low-income areas, including Indian Lands and affordable housing projects.

The 48E(h) program builds on the earlier 48(e) bonus credit. In its first year, the program received over 54,000 applications from across 48 states, the District of Columbia, and four territories. Approved projects are projected to generate $3.5 billion in investments and save $270 million annually in energy costs. The second year saw an increase with over 57,000 applications amounting to over 1.9 gigawatts of clean energy generation. These are expected to bring approximately $4 billion in investment and nearly $350 million in annual energy cost savings.

New rules expand eligible technologies beyond wind and solar to include zero-emissions options like hydropower and geothermal. The credit provides a boost of up to 20 percentage points on top of a 30 percent investment tax credit if certain conditions are met.

U.S. Deputy Secretary of the Treasury Wally Adeyemo stated, “Expanding the Clean Electricity Low-Income Communities Bonus Credit will help lower energy costs in communities that have been overlooked and left out for too long.”

The program plans to allocate bonuses for generating 1.8 gigawatts of clean electricity annually through at least 2032. Applications for the 2025 Program Year open on January 16 at 9:00 AM ET and close on August 1 at 11:59 PM ET.

Significant changes from previous years include expanded eligibility for various technologies, clearer criteria for low-income household projects, and new opportunities for small businesses to apply.

The Treasury's guidance also outlines capacity limitations divided among four facility categories: low-income community locations, Indian Lands, qualified low-income residential buildings, and economic benefit projects.

Interested parties can find more information or submit applications via the IRS website.