SECTION 2. BACKGROUND

.01 For purposes of the § 38 gener­ al business credit, § 46 provides that the amount of the investment credit for any taxable year is the sum of the credits list­ ed in § 46. That list includes the § 48C credit, which was originally enacted by § 1302(b) of the American Recovery and Reinvestment Act of 2009 (2009 Act), Public Law 111-5, Division B, Title I, Subtitle D, 123 Stat. 115, 345 (February 17, 2009), to provide an allocated credit for qualified investments in qualifying ad­ vanced energy projects.

.02 In addition to certain amendments made by the Tax Increase Prevention Act of 2014, Public Law 113-295, 128 Stat. 4010 (December 19, 2014), § 48C was most recently amended by § 13501 of Pub­ lic Law 117-169, 136 Stat. 1818 (August 16, 2022), commonly known as the Infla­ tion Reduction Act of 2022 (IRA). Sec­ tion 13501(a) of the IRA added § 48C(e) to the Code to extend the § 48C credit and to provide an additional credit allocation of $10 billion. Section 13501(b) of the IRA modified the definition of a “quali­ fying advanced energy project” contained in § 48C(c)(1)(A). Section 13501(c) and (d) of the IRA made conforming amend­ ments to § 48C(c)(2)(A) and (f). The amendments made by § 13501 of the IRA became effective on January 1, 2023. See § 13501(e) of the IRA.

1 Unless otherwise specified, all “section” or “§” references are to sections of the Code.

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(2) fuel cells, microturbines, or energy storage systems and components;

(3) electric grid modernization equip­ ment or components;

(4) property designed to capture, re­ move, use, or sequester carbon oxide emissions;

(5) equipment designed to refine, elec­ trolyze, or blend any fuel, chemical, or product which is renewable, or low-car­ bon and low-emission;

(6) property designed to produce ener­ gy conservation technologies (including residential, commercial, and industrial ap­ plications);

(7) light-, medium-, or heavy-duty electric or fuel cell vehicles, as well as technologies, components, or materials for such vehicles, and associated charging or refueling infrastructure;

(8) hybrid vehicles with a gross vehi­ cle weight rating of not less than 14,000 pounds as well as technologies, compo­ nents, or materials for such vehicles; or

(9) other advanced energy property designed to reduce greenhouse gas emis­ sions as may be determined by the Sec­ retary.

See Appendix A for more information regarding these definitions.

.03 Eligible Property . The term eligible property means any property that meets the following requirements:

(1) the property is necessary for the pro­ duction or recycling of specified advanced energy property described in § 48C(c)(1) (A)(i) (and section 3.02 of this notice), re-equipping an industrial or manufactur­ ing facility described in § 48C(c)(1)(A)(ii) (and section 3.01(1)(b) of this notice), or re-equipping, expanding, or establishing an industrial facility described in § 48C(c) (1)(A)(iii) (and section 3.01(1)(c) of this notice).

(2) the property is: (a) tangible personal property; or (b) other tangible property (not includ­ ing a building or its structural compo­ nents) that is used as an integral part of the qualifying advanced energy project.

(3) depreciation (or amortization in lieu of depreciation) is allowable with respect to the property.

.04 Placed In Service . (1) In general . Eligible property (as defined in § 48C(c) (2) and section 3.03 of this notice) is

of credits under the § 48C(d) allocation program established under the 2009 Act, and

(2) Are described in § 45(b)(11)(B)(iii) as one of the following:

(a) a census tract in which a coal mine has closed after December 31, 1999;

(b) a census tract in which a coal-fired electric generating unit has been retired after December 31, 2009; or

(c) a census tract directly adjoining a census tract described in section 2.07(2) (a) or (b) of this notice.

.08 Section 48(C)(e)(3)(A) provides that each applicant for certification must submit an application at such time and containing such information as the Secre­ tary may require.

.09 Section 48C(e)(3)(B) provides that each applicant for certification has 2 years from the date of acceptance by the Sec­ retary of the § 48C(e) application during which to provide to the Secretary evidence that the requirements of the certification have been met.

.10 Section 48C(e)(3)(C) provides that an applicant who receives a certification has 2 years from the date of issuance of the certification to place the project in ser­ vice and to notify the Secretary that such project has been so placed in service. If the project is not placed in service within the 2-year period, then the certification is no longer valid. If any certification is re­ voked under § 48C(e)(3), the total amount of the credits that may be allocated under § 48C(e)(2) is increased by the amount of § 48C credits with respect to such revoked certification.

.11 Section 48C(e)(3)(D) provides that in the case of an applicant which receives a certification, if the Secretary determines that the project has been placed in service at a location that is materially different than the location specified in the § 48C(e) application for such project, the certifica­ tion is no longer valid.

.12 The at-risk rules provided by § 49, the credit recapture and other special rules provided in § 50, and pursuant to § 48C(b) (2), rules regarding qualified progress ex­ penditures (similar to the rules of § 46(c) (4) and (d) (as in effect on the day before the enactment of the Revenue Reconcili­ ation Act of 1990)) apply for purposes of the § 48C credit.