SECTION 5. QUALIFYING

ADVANCED ENERGY PROJECT PROGRAM

.01 In General . The Service will consider a project under the qualifying advanced energy project program only if the U.S. Department of Energy (DOE) provides a recommendation and ranking for the project (DOE recommendation). DOE will provide a recommendation and ranking only if it determines that the project has a reasonable expectation of commercial viability and merits a recommendation based on the criteria in § 48C(d)(3)(B). Accordingly, a taxpayer must submit, for each project that it sponsors: (1) a preliminary application and a final application for

recommendation by DOE (application for DOE recommendation), and (2) an application for certification under § 48C(d)(2) by the Service (application for § 48C certification). Certifications will be issued and credits will be allocated to projects in annual allocation rounds. The initial allocation round will be conducted in 2009–2010, and if necessary, an additional allocation round will be conducted in 2010–2011.

.02 Program Specifications . (1) The Service determines the amount of the qualifying advanced energy project credit allocated to a qualifying advanced energy project at the time the Service accepts the application for certification for that project in accordance with section 5.02(8) of this notice (see section 6 of this notice for the requirements applicable to the application for DOE recommendation and the application for § 48C certification).

(2) The DOE recommendations will include a ranking of projects in descending order (that is, first, second, third, etc.). The project receiving the highest ranking (that is, first) will be allocated the full amount of credit requested before any credit is allocated to a lower-ranked project. The amount of credit allocated to a project reduces the amount of credit available to lower-ranked projects. The same process will apply to the second and lower-ranked projects until the amount available for allocation is exhausted. DOE will recommend and rank projects only to the extent necessary to exhaust the amount available for allocation.

(3) If the amount available for allocation is not fully allocated in the 2009–2010 allocation round, a similar allocation round will be conducted in 2010–2011. The Service will announce the results after the close of each allocation round.

(4) For each allocation round there will be an annual application period during which a taxpayer may file its application for certification. The Service will consider a project in an allocation round only if the application for certification for the project is submitted during the application period for that round and the DOE provides the DOE recommendation for the project.

(5) For the 2009–2010 allocation round, the application period for certification begins on August 14, 2009, and ends on December 16, 2009. Any completed applica

2009–37 I.R.B. 326 September 14, 2009

the certification have been met. Section 48C(d)(2)(C) provides that a taxpayer that receives a certification has 3 years from the date of issuance of the certification to place the project in service and that the certification is void if the project is not placed in service by the end of that three-year period.

.02 Requirements for Certification . (1) Within 1 year from the acceptance date (as determined in section 5.02(8) of this notice), the taxpayer must submit to the Service documentation establishing the following:

(a) The taxpayer has received all federal, state, and local permits, including environmental authorization or reviews necessary to commence construction of the project.

(b) The taxpayer has completed all steps that must be accomplished during the 1-year period beginning on the acceptance date if the project is to be placed in service before the end of the 3-year period beginning on the date of issuance of the certification (assuming such certification will be issued on the one-year anniversary of the acceptance date).

(2) The taxpayer must also comply with the requirements of sections 8.01 and 8.02 of this notice. The taxpayer should mark the package, “SECTION 48C CERTIFICATION REQUIREMENTS” and send it to the appropriate address listed in section 6.04 of this notice or listed in later guidance published in the Internal Revenue Bulletin.

.03 Service’s Action on Certification . After receiving the submission described in section 7.02 of this notice, the Service will decide whether or not to certify the project and will notify the taxpayer, by letter, of that decision. If the Service certifies the project, the date of this letter is the date of issuance of the certification.