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Treasury Gearing Up for Energy Tax Credit Transfers

The Inflation Reduction Act of 2022 (the “IRA”) now allows firms to develop and sell clean energy tax credits.  The IRA also increased the amount of existing energy tax credits that are now eligible for sale, such as the energy investment tax credit for qualifying clean energy projects.  Taxpayers can increase the amount of the credit from 6% of the tax basis of a qualifying project to 30% by satisfying certain criteria, such as the prevailing wage and apprenticeship requirements. 

On November 17, 2023, the IRS issued proposed regulations, available here, that provide clarity on the types of equipment that are eligible for the energy investment tax credit and revise various technical definitions.

As we discussed here, Treasury is thinking creatively about new ways to expand participation in energy tax credit transfers to help advance the Biden Administration’s clean energy goals.  The new guidance provides increased clarity for clean energy developers, fostering the hope that a market for these credits will emerge.

Key Contacts

Linda Z. Swartz
T. +1 212 504 6062


Adam Blakemore
T. +44 (0) 20 7170 8697

Jon Brose
T. +1 212 504 6376

Andrew Carlon
T. +1 212 504 6378

Mark P. Howe
T. +1 202 862 2236

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