The U.S. Department of the Treasury and the IRS have released final rules for the Advanced Manufacturing Production Credit, part of Section 45X of the Internal Revenue Code. This initiative is aimed at fostering growth in U.S. clean energy manufacturing under President Biden and Vice President Harris' Investing in America Agenda.
The credit is designed to support U.S. companies in producing critical clean energy technologies domestically, such as solar and wind components, batteries, energy storage, and critical minerals. The newly announced rules are expected to expand the country's clean energy manufacturing base, create jobs, enhance energy security, and establish reliable supply chains necessary for meeting climate goals.
A significant aspect of these rules is their focus on accelerating domestic critical mineral supply chains by allowing taxpayers to include materials and extraction costs in production costs for certain minerals and electrode active materials. This adjustment aims to boost investment in responsible U.S. mineral extraction and processing.
U.S. Secretary of the Treasury Janet L. Yellen commented on the economic impact: "The Biden-Harris Administration’s economic agenda is driving a manufacturing boom across the country that I’ve seen first-hand in North Carolina, Kentucky, and Georgia." She emphasized that these investments are creating jobs and strengthening supply chains.
U.S. Secretary of Energy Jennifer Granholm highlighted how these changes would promote energy security: "These final rules will help strengthen energy dominance while reducing emissions."
John Podesta, Senior Advisor to the President for International Climate Policy, noted that since President Biden took office, nearly $450 billion has been invested by the private sector into America's clean energy economy.
National Economic Advisor Lael Brainard stated that these tax credits would catalyze business investment in future clean energy technologies while securing domestic supply chains.
White House National Climate Advisor Ali Zaidi remarked on revitalizing American manufacturing: "We are flexing America’s industrial muscle... These Biden-Harris tax credits are knocking down barriers to economic opportunity."
Since the signing of the Inflation Reduction Act over two years ago, more than $126 billion has been announced for clean energy manufacturing investments. The new rules aim to provide clarity for further investments by defining key terms and confirming credit amounts for eligible components like solar panels and wind turbines.
These regulations also include safeguards against potential fraud or abuse related to duplicative crediting or non-value-added activities.
