A KPMG report that provides analysis and observations of the final regulations on clean electricity production and investment credits.
The U.S. Treasury Department and IRS on January 7, 2025, issued final regulations (T.D. 10024) related to the section 45Y clean electricity production credit and section 48E clean electricity investment credit for qualified facilities and energy storage technology (EST). In general, the provisions are effective for property placed in service after 2024 in tax years ending on or after the date the final regulations were published in the Federal Register, which is January 15, 2025.
A qualified facility for purposes of section 45Y and 48E is a facility that produces electricity for which the greenhouse gas emissions rate is not greater than zero (“zero emissions facility”). Generally, a taxpayer may claim either section 45Y or 48E but not both with respect to the same facility.
EST is eligible only for the section 48E credit and is generally defined as: (1) property which receives, stores, and delivers energy for conversion to electricity (or, in the case of hydrogen, which stores energy) and has a nameplate capacity of not less than 5 kilowatts, (2) thermal energy storage property or (3) hydrogen energy storage property.
Read a March 2025 report prepared by KPMG LLP that provides analysis and observations of the final regulations.