In August 2022, the Inflation Reduction Act (H.R. 5376) was signed into law. The legislation comprises eight titles with many provisions intended to incentivize the production of new energy technologies.
Following its enactment, Energy Workforce, through its Government Affairs team and committees, has initiated various discussions with its membership to outline both the opportunities and challenges specific to the sector. Noteworthy for member companies is the establishment of new Production Tax Credits (PTC) for carbon capture (45Q), clean hydrogen (45V), and component manufacturing (45X). Energy Workforce compiles information for these events and newsletter updates, which often reside in disparate government sources and lack additional industry context, for the membership’s awareness and use.
Since the act’s passage, several significant proposals have emerged aiming to define elements and provide clarity on tax credit guidance, interpreting the new provisions. These updates are crucial for industry stakeholders and companies seeking to leverage tax opportunities as details unfold. For instance, the IRS and Treasury recently issued proposed regulations concerning the Section 45V tax credit for qualified clean hydrogen production, outlining guidance on temporal matching, additionality, and deliverability. Additionally, the Treasury released supplementary guidance on rules pertaining to meeting prevailing wage and apprenticeship requirements for tax incentives within the IRA. Member companies interested in providing input on such proposals can engage with Energy Workforce to establish working groups under the Government Affairs committee for drafting response comments.
It is also important to remember that the IRA is subject to changes and modifications by future Congresses depending on the makeup and results of the coming elections in November. Of particular note are recent comments by House leaders, such as Representatives Graves and Carter, that have said that if in power, the GOP would institute significant changes to the legislation and overall spending but probably not go as far as a full repeal. For additional data on IRA programs and Loan guarantee awards, please contact the Government Affairs team via Maria Suarez-Simmons.
Maria Suarez-Simmons, Senior Director Energy Policy, writes about industry-specific policies for the Energy Workforce & Technology Council. Click here to subscribe to the Energy Workforce newsletter, which highlights sector-specific issues, best practices, activities and more.
