The Biden administration announced proposals to expand tax credits beyond solar and wind energy to include other renewable and clean energy sources, such as nuclear fission and fusion on Wednesday, 29 May 2024.
This comes after the US Treasury Department released its guidance on Clean Electricity Production Credits and Clean Electricity Investment Credits introduced under the 2022 Inflation Reduction Act (IRA). These credits will be available in 2025 and aim to replace the existing wind and solar production and investment tax credits as they expire.
“The Inflation Reduction Act’s new technology-neutral Clean Electricity credits, which will come into effect in 2025, are one of the law’s most significant contributions to tackling the climate crisis,” said John Podesta, Senior Advisor to the President for International Climate Policy.
The proposal outlines six technologies that may qualify for significant tax credits, which includes marine and hydrokinetic energy, hydropower, nuclear fission and fusion, geothermal, and certain types of waste energy recovery.
Tax credits for wind and solar projects can reach up to 30%, provided all conditions are met.
Treasury Secretary Janet Yellen informed reporters that the IRA has already attracted investments over USD 850 billion from private sectors in clean energy and manufacturing. This initiative has also resulted in record increases in renewable energy capacity.
