Equipment manufacturers gain tax credit

By Kevin Matthews
Vice President, Energy & Environment Sector

If a manufacturer produces clean energy equipment such as microturbines or electric cars, they can now claim their share of $2.3 billion in new tax credits for up to two years.

The U.S. Department of the Treasury and the U.S. Department of Energy joined forces to create the program, aimed at increasing economic development and pursuing energy independence. According to a press release, the program authorizes the Treasury to provide developers with an investment tax credit of 30 percent for facilities that manufacture particular types of energy equipment. Examples include solar, wind, and geothermal energy equipment; fuel cells, microturbines, and batteries; electric cars; electric grids to support the transmission of renewable energy; energy conservation technologies; and equipment that captures and sequesters carbon dioxide or reduces greenhouse gas emissions.

The innovative partnership combined with a common economic recovery strategy forms another example of how Recovery Act money can help ease companies’ current financial burdens brought on by a bleak economy and move toward a future of job growth and security. Frankly, it could play a key role in mere survival for many. It’s absolutely an important new dimension to the incentives created in the Recovery Act to increase U.S. manufacturing output, improve energy efficiency, and develop alternative sources of energy.

The manufacturing tax credit is capped at $2.3 billion, and credits are available for two years or until the cap is reached. Companies can expect to receive payments within 180 days of filing for the credit. To view the program summary and guidance for applying for the tax credit, please visit the Advanced Energy Manufacturing Tax Credit (48C) page.
Kevin Matthews is Vice President of the Energy and Environment Sector for NSI, where he runs the day-to-day sector operations and works with clients on sustainable solutions for interfacing with state and local governments.