WASHINGTON (January 7, 2025)— The U.S. Department of the Treasury and the Internal Revenue Service (IRS) today issued final rules governing implementation of the Section 45Y Clean Electricity Production Credit (45Y) and Section 48E Clean Electricity Investment Credit (48E). These rules establish how generator eligibility is determined for the new technology-neutral clean electricity tax credits, which have the potential to account for the largest share of emissions reductions enabled by the Inflation Reduction Act.
Below is a statement by Julie McNamara, senior analyst for the Climate and Energy Program at the Union of Concerned Scientists (UCS).
“Success of the nation’s clean energy transition relies on the rapid, widescale deployment of clean electricity resources and these tax credits are the critical foundation on which that deployment stands. Unambiguous clarity on eligibility of core clean energy contributors, most prominently wind, solar, and energy storage, provides the certainty necessary to ensure these resources continue to be deployed widely across the United States without delay, resulting in increased grid reliability, lower electricity costs, new jobs and local investments, and improved public health.
“For all the rigor of the finalized rules, we remain vigilant to the risk of polluting electricity generators, including gas-fired power plants, attempting to co-opt the technology-neutral framework to greenwash their emissions-heavy operations. Policymakers and regulators must ensure incentives intended to drive the U.S. economy forward don’t instead further subsidize and entrench polluters.
“The clean electricity incentives were specifically structured to provide investors with the long-term certainty needed to commit to building out clean energy at scale. Any effort to undermine that certainty threatens to stall forward-looking investments and in turn the economic, health, and climate benefits they would bring. Short-sighted political gamesmanship must not supersede what’s in the clear and obvious best interests of the public.”
Additional resources and analyses:
- A 45Y, 48E background blogpost by McNamara.
- A blogpost by McNamara explaining technical comments related to the 45Y and 48E tax credits submitted by UCS.