Clean energy projects

Inflation Reduction Act Resource Center

Stay up to date on the Inflation Reduction Act (IRA) and what it could mean for your organization.

The Inflation Reduction Act of 2022 (IRA) was signed into law by President Biden on Aug.16, 2022. The IRA includes the largest energy incentive effort in U.S. history. It builds on the energy initiatives included in 2009’s American Reinvestment Recovery Act, creating an environment where many energy-related projects become significantly more attractive to more types of entities than in the past.

The IRA includes more than 70 investment, production and excise credits designed to facilitate the transition to cleaner energy production, promote advanced manufacturing, encourage the adoption of clean vehicles (CVs) and reduce greenhouse gas emissions through the use of alternative fuels and energy efficient technologies. Additionally, significant enhancements have been made to the U.S. Department of Agriculture (USDA) and Department of Energy (DOE) loan programs.

These credits represent a financial offset for an organization’s qualified construction or production costs, making the economics of many projects work better than they would have without the credits. Most credits are good through 2032, the longest U.S. “energy policy” timeframe ever.

To maximize any credit, entities will have to prioritize existing and future projects, adjusting the timetable, location and production processes, if possible.

Existing credits vs. new credits

Looking up at sunlight shining through trees

There are many types of funding opportunities under the IRA. The below provides an overview of the existing and new tax credits. Qualifying Energy Property projects has a broad definition and can include but is not limited to the following project types:

Existing credits with enhanced features are available in the following areas:

  • Biomass
  • Carbon capture utilization and storage
  • Combined heat and power (CHP)
  • Geothermal heating and cooling
  • Low carbon fuels (biodiesel, ethanol, renewable diesel, renewable natural gas, propane)
  • Waste to energy recycling
  • Wind, solar, hydro electric

New credits are available for the following:

  • Clean hydrogen
  • Clean transportation fuels
  • Electric vehicles (EVs) and EV infrastructure
  • Energy efficiency construction
  • Energy equipment and component manufacturing
  • Energy storage (batteries)
  • Qualifying biogas
  • Solar production tax credit (PTC)
  • Sustainable aviation fuels
  • Zero emission nuclear