CREDIT AMOUNT

Under § 45I(b)(1)(B) and (2)(B), the tentative credit amount used to calculate the MWC for taxable years beginning in calendar year 2024 is $0.77 per Mcf ($0.50 × 1.5447 inflation adjustment factor). However, to determine the credit amount for purposes of § 45I(a)(1), the tentative credit amount must be reduced as provided by § 45I(b)(2).

Specifically, pursuant to § 45I(b)(2) (A), the tentative credit amount is reduced (but not below zero) by an amount (the Reduction Amount) which bears the same ratio to such amount as (i) the excess (if any) of the applicable reference price over $2.58 ($1.67 × 1.5447 inflation adjustment factor), bears to (ii) $0.51 ($0.33 × 1.5447 inflation adjustment factor). The Reduction Amount (as adjusted for inflation) is computed as follows:

Reduction Amount Applicable Reference Price – $2.58

Tentative Credit Amount $0.51

Reduction Amount $2.04 – $2.58

$0.77 $0.51