- The Internal Revenue Service (IRS) issued guidance on Friday, establishing that solar developers who invest at least 5% of the total expected installation cost of a project by the end of 2019 will qualify for a 30% investment tax credit (ITC).
- The 2015 law that established the credit did not specifically define what qualifies as beginning construction on a project, to the consternation of the solar industry. The new guidance specifies that developers have four years to begin a project to qualify for the ITC, which then begins to wind down from 30% to 10% based on the construction and service dates of the project.
- The notice also specifies the deadlines and qualifications for other types of energy properties that qualify for a tax incentive, including small wind projects, fuel cell power plants, geothermal heat pumps and more.
“With this notice, IRS sent a strong signal to investors while giving developers clear criteria on par with other renewable technologies,” Liam Donovan, a principal at the law firm Bracewell LLP, told Utility Dive via email.