Energy Community
Tax Credit Bonus

As defined in the Inflation Reduction Act (IRA), the Energy Community Tax Credit Bonus applies a bonus of up to 10% (for production tax credits) or 10 percentage points (for investment tax credits) for projects, facilities, and technologies located in energy communities. Increased credit amounts or rates are available to taxpayers that satisfy certain energy community requirements under Section 45, 48, 45Y, or 48E of the Internal Revenue Code. The IRA defines energy communities as:

1. A “brownfield site” (as defined in certain subparagraphs of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA))
2. A “metropolitan statistical area” or “non-metropolitan statistical area” that has (or had at any time after 2009)
   • 0.17% or greater direct employment or 25% or greater local tax revenues related to the extraction, processing, transport, or storage of coal, oil, or natural gas; and
   • has an unemployment rate at or above the national average unemployment rate for the previous year
3. A census tract (or directly adjoining census tract)
   • in which a coal mine has closed after 1999; or
   • in which a coal-fired electric generating unit has been retired after 2009

For additional information, see Treasury Notice 2023 – 29, Appendix A, Appendix B, and Appendix C.

The mapping tool below reflects currently available data on two types of potentially qualifying energy communities. First, the map shows the census tracts and directly adjoining tracts that have had coal mine closures since 1999 or coal-fired electric generating unit retirements since 2009. These census tracts qualify as energy communities. Second, the map shows the metropolitan statistical areas (MSAs) and non-metropolitan statistical areas (non-MSAs) that have had 0.17% or greater direct employment related to extraction, processing, transport, or storage of coal, oil, or natural gas. Only a subset of these MSAs and non-MSAs will qualify as energy communities, depending on whether their unemployment rate for the previous year is equal to or greater than the national average unemployment rate. Annual unemployment rates at the county level for 2022 will be released in April 2023. This map will be updated with the MSAs and non-MSAs that meet both the 0.17% employment threshold and the unemployment rate requirement once the 2022 unemployment rates are released. The updated map will be released in May 2023. Note that brownfields are not shown on this map.