On February 13, 2023, the Internal Revenue Service (IRS) published guidance on how it will allocate 1.8 gigawatts of capacity in bonus renewable energy Investment Tax Credits (ITCs) to low-income communities as provided in the Inflation Reduction Act (IRA) as well as guidance on the qualifying advanced energy project credit program. See the relevant notices below:
- Notice 2023-18 dated February 13, 2023. IRS and Treasury provide guidance on the Qualifying Advanced Energy Project Credit. The Notice establishes the section 48C(e) program to allocate $10 billion in credits ($4 billion of which may only be allocated to projects located in certain energy communities census tracts). The notice also provides initial program guidance.
- Notice 2023-17 dated February 13, 2023. Treasury and IRS provide guidance on energy projects for low-income communities. The Notice establishes the Low-Income Communities Bonus Credit Program and provides initial guidance for potential applicants for allocations of calendar year 2023 capacity limitation.