Washington, D.C. — The U.S. Department of the Treasury and the U.S. Department of Energy (DoE) have announced a program to award $2.3 billion in tax credits for manufacturers of advanced energy equipment. Under the American Recovery and Reinvestment Act (Recovery Act), this new program will provide tax credits of 30 percent to manufacturers that produce clean energy equipment.
Qualifying manufactures will produce solar, wind, and geothermal energy equipment; electric grids to support the transmission of renewable energy; fuel cells, microturbines, batteries, electric cars, energy conservation technologies, and equipment that captures and sequesters carbon dioxide or reduces greenhouse gas emissions.
The manufacturing tax credit is capped at $2.3 billion, and credits are available for two years or until the cap is reached. Companies can expect to receive payments within 180 days of filing for the credit. For more information about the program and guidance, visit Advanced Energy Manufacturing Tax Credit (48C).
Tax programs have provided successful incentives for encouraging the development of renewable energy in the past, said the agencies. In 2006 alone, approximately $550 million in renewable energy tax credits were provided to 450 businesses.
In July, Treasury and Energy announced the availability of a payment in lieu of tax credits for facilities that produce renewable energy, a program that is expected to result in more than $3 billion of stimulus for energy development in rural and urban communities.
“Wind power is a bright source of manufacturing jobs in the U.S. today. With this incentive and with the right policies in place, it can become an even much larger source of jobs tomorrow,” said Denise Bode, CEO, American Wind Energy Association (AWEA), in a statement.
Bode also said that the share of domestically manufactured wind turbine components has risen to 50 percent in the wind turbines installed in the U.S. in 2008, up from less than 30 percent in 2005.
In 2008 alone, 55 wind energy manufacturing facilities were announced, opened or expanded. While the current economic conditions have dampened demand, the tax credits are expected to boost the opening of new facilities, according to AWEA.
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