nuclear-news

USA’s Inflation reduction act expands tax-payer funding for nuclear power plants

Bryan Cave Leighton Paisner

The Inflation Reduction Act (“IRA”) created new incentives for the generation of electricity from nuclear power plants, supplementing incentive provisions that are currently in place.  The primary changes are (i) the adoption of a new 8-year production tax credit (“PTC”) for certain existing nuclear power plants, and (ii) enabling nuclear facilities to qualify under the new technology-neutral zero-emission PTC and investment tax credit (“ITC”) regime that will apply beginning in 2025.  Some of the other incentives adopted by the IRA may also support the nuclear industry.

Existing Incentives Prior to IRA

The advanced nuclear production tax credit (“Advanced Nuclear PTC”) under Code Section 45J of the Internal Revenue Code (the “Code”)………………………………..

Inflation Reduction Act Incentives…………….  enabling new nuclear power plants placed in service after December 31, 2024 to participate in the PTC and ITC incentives available for the production of electricity from renewable and other low-carbon sources. 

Zero-Emission Nuclear Power Production Tax Credit

The IRA creates a new zero-emission nuclear power production tax credit (“Zero Emission PTC”)  for certain existing nuclear power plants under Section 45U of the Code. ………………………

Clean Electricity Production Tax Credit

For facilities placed in service after December 31, 2024, the IRA replaces the existing PTC under Section 45 of the Code with a technology-neutral “zero emissions” clean electricity production tax credit (“Clean Electricity PTC”) under Section 45Y of the Code……………………………

Clean Electricity Investment Tax Credit

For facilities placed in service after December 31, 2024, the IRA also replaces the existing ITC under Section 48 of the Code with a technology-neutral “zero emissions” clean electricity investment tax credit (“Clean Electricity ITC”) under Section 48E of the Code. The credit is available for any “qualified facility” and certain energy storage technology…………………………….

Other Tax Credit Incentives

The IRA provides some additional tax credit incentives that could benefit the development of future nuclear power plants…………………………………

High-Assay Low-Enriched Uranium Funding

The IRA also earmarks $700 million for the development of a domestic market and production of high-assay low-enriched uranium (“HALEU”)………………………….  https://www.jdsupra.com/legalnews/inflation-reduction-act-expands-support-4367428/—

June 14, 2023 - Posted by Christina Macpherson | politics, USA