On November 30, 2022 the U.S. Treasury Department unveiled the prevailing wage and apprenticeship guidance. Companies seeking clean energy tax credits under the Inflation Reduction Act must follow these guidelines, published in the Federal Register.
The Inflation Reduction Act created and expanded several tax credits, but stipulated that taxpayers could only take full advantage of these credits if they have projects that either meet the prevailing wage and apprenticeship requirements or that have commenced construction within 60 days of the release of this guidance.
“Nearly every ethanol and biodiesel producer in the U.S. has an opportunity to take advantage of this legislation to some extent,” says Donna Funk, Pinion biofuel advisor. “Planning and understanding now is key, but also difficult since we have as many unknowns as we do knowns. We do advise everyone to ensure they have an updated GREET score.”
Affected tax credits include:
- Alternative fuel refueling property credit
- Credit for carbon oxide sequestration
- Credit for production of clean hydrogen
- Clean electricity production credit
- Clean electricity investment credit
If you are interested in any of these tax credits, Pinion can help you sort through whether the prevailing wage and apprenticeship requirements apply to you and, if they do, whether you meet those requirements. Pinion is helping clients evaluate their ability to qualify for tax credits for generating renewable energy, sequestering carbon dioxide, and producing clean biofuels.
Contact a Pinion advisor for questions on any of these tax credits.