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1 1 (October 3, 2023)

handle is hein.crs/govenbi0001 and id is 1 raw text is: Congressional_______ Research Service Recent Developments in the Federal Multipronged Approach to Solar and Wind Energy October 3, 2023 In the opening days of the Biden Administration, the President issued Executive Order 14008, directing the Administration to focus on actions to address climate change. In the wake of this directive, the federal government has taken actions to encourage the deployment of renewable energy and other low-carbon energy sources. Actions to expand generation and consumption of solar and wind energy are seen in three distinct arenas: (1) incentivizing renewable energy production and use, (2) increasing the use of public lands for solar and wind energy projects, and (3) expanding electricity transmission to allow utility-scale solar projects to connect to the grid and ultimately serve consumers. This Legal Sidebar identifies some legal considerations in the recent federal efforts to encourage and enhance solar energy production and consumption in each of these arenas. Private Sector Incentives: The Inflation Reduction Act of 2022 The omnibus statute P.L. 117-169, commonly known as the Inflation Reduction Act of 2022 (IRA), included measures designed to encourage solar energy production and consumption. A key legal tool that Congress used to implement this policy was amending the Internal Revenue Code (IRC). Perhaps the most prominent of these amendments was the extension and modification of the investment tax credits (ITCs) for solar, wind, and geothermal energy projects and the companion credit for residential clean energy investments in Section 25D. Tax credits provide a dollar-for-dollar reduction of income taxes. As amended by the IRA, Section 25D (which establishes the residential clean energy tax credit for individuals) now provides for an increased tax credit up to 30% of expenditures on certain clean energy property, depending on when the property is placed in service. The amendments also extend the credits through 2034. Prior to passage of the IRA, Section 48 established the tax credit for businesses investing in renewable energy projects. The IRA amended Section 48 to extend the credit and adjust credit percentages, but it also adopted Section 48E, which will establish a new clean energy ITC for any projects placed into service after December 31, 2024. Rather than focusing explicitly on the technology being employed, the Congressional Research Service https://crsreports.congress.gov LSB11054 CRS Legal Sidebar Prepared for Members and Committees of Congress

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