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Preliminary Evaluation of the Impact of the Section 1603 Treasury Grant Program on Renewable Energy Deployment in 2009.


DE2010983046

Publication Date 2010
Personal Author Bolinger, M.; Wiser, R.; Darghouth, N.
Page Count 47
Abstract Federal support for renewable energy deployment in the United States has traditionally been delivered primarily through tax benefits, including the production tax credit ('PTC') in Section 45 of the U.S. tax code, investment tax credits ('ITC') in Sections 25D and 48, and accelerated tax depreciation in Section 168. Many renewable power project developers are unable to use the majority of these tax benefits directly or immediately, however, and have therefore often relied on third-party 'tax equity' investors for the necessary investment capital in order to monetize the available tax benefits. As has been well-publicized, most of these tax equity investors were hit hard by the global financial crisis that unfolded in the last months of 2008 and, as a result, most either withdrew from the renewable power market at that time or reduced their available investment capital. This left a significant financing gap beginning in late 2008, and placed at some risk the continued near-term growth of renewable energy supply in the U.S. In recognition of these developments, the U.S. Congress passed two stimulus bills - The Energy Improvement and Extension Act ('the Extension Act') in October 2008 and The American Recovery and Reinvestment Act ('the Recovery Act') in February 2009 - parts of which were intended to address the growing shortage of finance for renewable power projects. Most notably, Section 1603 of the Recovery Act enables qualifying commercial renewable energy projects to choose between the Section 45 PTC, the Section 48 ITC, or a cash grant of equal value to the Section 48 ITC (i.e., 30% of the project's eligible basis in most cases).
Keywords
  • Wind power
  • Energy efficiency
  • Renewable energy
  • Tax credits
  • Depreciation
  • Financing
  • Shortages
Source Agency
  • Technical Information Center Oak Ridge Tennessee
Corporate Authors Lawrence Berkeley National Lab., CA. Environmental Energy Technologies Div.; Department of Energy, Washington, DC.
Supplemental Notes Sponsored by Department of Energy, Washington, DC.
Document Type Technical Report
NTIS Issue Number 201108
Contract Number
  • DE-AC02-05CH11231
Preliminary Evaluation of the Impact of the Section 1603 Treasury Grant Program on Renewable Energy Deployment in 2009.
Preliminary Evaluation of the Impact of the Section 1603 Treasury Grant Program on Renewable Energy Deployment in 2009.
DE2010983046

  • Wind power
  • Energy efficiency
  • Renewable energy
  • Tax credits
  • Depreciation
  • Financing
  • Shortages
  • Technical Information Center Oak Ridge Tennessee
  • DE-AC02-05CH11231
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