Monday, August 03, 2009

U.S. Treasury Department Accepting Applications for ITC Grants

The Treasury Department and the Department of Energy announced on Friday that they are now accepting applications for grants for renewable energy facilities under section 1603 of the American Recovery and Reinvestment Act of 2009 (ARRA). Section 1603 established the grant in lieu of a tax credits program, which authorizes the Treasury Department to issue grants to renewable energy facilities that would otherwise qualify for the investment or production tax credit (ITC or PTC). The Treasury Department released guidance for the grant program earlier in July.

According to the DOE and Treasury press release, the two agencies estimate distributing at least $3 billion in financial support to approximately 5,000 biomass, solar, wind, and other types of renewable energy production facilities.

To be eligible for the program the facility must be either (1) placed in service between January 1, 2009, and December 31, 2010, (regardless of when construction begins), or (2) begin construction between January 1, 2009, and December 31, 2010 and be placed in service after 2010 but before the "credit termination date" for that type of facility. The "credit termination date" varies by facility:
  • Large wind facilities must be placed in service before January 1, 2013;
  • Open and closed loop biomass facilities, landfill gas facilities, trash facilities, qualified hydro facilities, marine facilities, and geothermal facilities authorized under Internal Revenue Code Section 45 are eligible if placed in service before January 1, 2014;
  • Solar facilities, combined heat and power facilities, small wind facilities, and geothermal facilities authorized under Internal Revenue Code Section 48 must be placed in service by January 1, 2017.
Grants will generally be limited to 30% of the cost basis for the facility.

The Treasury Department has set up a website for submitting section 1603 grant applications on-line.

The New York Times has a report on this program, as well as other renewable energy funding opportunities announced by DOE on Friday.

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