Financial Incentives

Transect's new "Financial Incentives" Report section informs you of where and when Investment Tax Credit (ITC) and Production Tax Credit (PTC) are applicable

Disclaimer: This provides an overview of the federal investment and production tax credits for businesses, nonprofits, and other entities that own solar facilities, including both photovoltaic (PV) and concentrating solar-thermal power (CSP) energy generation technologies. It does not constitute professional tax advice or other professional financial guidance and may change based on additional guidance from the Treasury Department. It should not be used as the only source of information when making purchasing decisions, investment decisions, tax decisions, or when executing other binding agreements.

Through various bills and government programs, significant tax credits and incentives are available for renewable energy projects that can add up to substantial amounts of up to 50% of the total project cost.

As a renewable energy developer, Transect's new "Financial Incentives" Report section informs you of where and when those tax incentives provided by the Investment Tax Credit (ITC) and Production Tax Credit (PTC) are applicable and provide a way to track and confirm that the credits apply to your project.

To learn more about the incentives opportunity available for your project, click "Financial Incentives." 

Next, visit "Does my project qualify?" and click the "Calculate" button. Four questions and the location of your project will give you insight into what amount of tax credits your project may be applicable for through the ITC or PTC. 

You will need to answer the following questions:
1. "What is your project size? (in megawatts AC)"
 a. This informs if your project qualifies for the Low Income Bonus

2. "Will this project meet the Treasure Department's labor requirements?"
 a.This informs if your project will be applicable for the Full Rate credit.

3."Will this project meet the domestic content requirements?"

 a.This informs if your project is applicable for the Domestic Content Bonus

4. "When will construction begin on this project?"

 a. This informs the rate schedule, the rates decrease over time after a certain threshold of when the project construction begins.

• "What is your total estimated project cost?" to calculate total project savings
• "What is your estimated power output?" to calculate estimated savings

As the calculations are complete, you will be able to see the following:

Investment Tax Credit Section:

• The Investment Tax Credit (ITC) opportunities for your project:
  • Base Credit → Turns ON if answered YES to question #2
  • Domestic Content Bonus → Turns ON if answered YES to question #3
  • Energy Community Bonus → Turns ON if project is within an Energy Community
  • Low Income Bonus → Turns ON if project is < 5 MW AND within a Low Income Community OR Indian Lands
• The Estimated Total Tax Liability for your project provided by the ITC

• The Production Tax Credit (PTC) opportunities for your project:
  • Base Credit → Turns ON if answered YES to question #2
  • Domestic Content Bonus → Turns ON if answered YES to question #3
  • Energy Community Bonus → Turns ON if project is within an Energy Community
• The Estimated Total Tax Liability for your project provided by the PTC

For more information on the Investment Tax Credit and the Production Tax Credit, you can click "Description" for a short description of both tax credits. "Links" directs you to more resources, like an in-depth overview of both tax credits. For more detail please visit energy.gov Federal Solar Tax Credits for Businesses. 

If you want to include the Financial Incentives information in your PDF export, you can add the "Financial Incentives" Report section to the PDF Builder queue.

References: 

Federal Solar Tax Credits for Businesses - US Department of Energy
Business Energy Investment Tax Credit (ITC) - DSIRE
Energy Communities: Coal Closure - US Department of Energy
Energy Communities: Brownfields - Resources.org
Energy Communities: Fossil Fuel Employment + High-Than-Average Unemployment Statistical Areas*** - Resources.org

***We have the MSA/Non-MSAs that meet the Fossil Fuel Employment 0.17% Threshold - US Department of Energy layer in Transect but are NOT yet using it in Instant Parcel Search or Financial Incentives calculator because it is not complete and will produce false positives. The DoE estimates an updated map will be released in May 2023, and we will update it once a complete map layer is available.