ITC – Energy Credit

Credit Type

Investment
Tax Credit

Technology

Electricity /
Storage

Eligibility

Fuel cell, solar, geothermal, small wind, energy storage, biogas, microgrid controllers, combined heat & power

Base Rate

6% of
eligible basis

Full Rate

30% of
eligible basis

Bonus Adders

  • Energy Community: +10 pp
  • Domestic Content: +10 pp
  • Low-Income: +10–20 pp
  • (IRS allocation; wind/solar <5 MW)

Duration

Upfront credit on capital investment

Period of Availability

Construction must have begun before 1/1/2025.
Exception: Geothermal heat pumps eligible for construction beginning before 1/1/2035 (OBBBA extension).
Replaced by §48E for projects starting 2025+.

Transferable (§6418)

Yes

Key Limitations & Notes

  • Cannot stack with §48E, §45, §45Y, §48C, or §45Q
  • 5-year recapture per §50 (decreases 20%/yr)
  • OBBBA eliminated the permanent 10% minimum ITC
  • No inflation adjustment