The Biden administration finalized tax rules Tuesday intended to drive some of the largest emissions reductions from the Inflation Reduction Act and spur growth in low-carbon technologies ranging from wind to nuclear power.
The regulations could determine how billions of dollars from the climate law are spent and are a key part of President Joe Biden’s climate agenda. They outline which types of projects qualify for incentives that replace the decades-old production tax credit for wind and investment tax credit for solar. They aim to drive much broader deployment of zero-carbon power by making funding contingent on how much projects cut emissions rather than if they are tied to a specific technology.
They also aim to avoid scenarios where developers are reliant on Congress for frequent renewals, a dynamic that caused frustration in the past with the wind and solar industries. The new incentives require qualifying technologies to not produce emissions during the production of electricity.
“The final rules issued today will help ensure America’s clean energy investment boom continues — driving down utility costs for American families and small businesses, creating good paying construction jobs, and strengthening energy security by making the U.S. more resistant to price shocks,” Treasury Secretary Janet Yellen said in a statement.
