The Department of the Treasury and the Internal Revenue Service, in partnership with DOE, have announced up to $6 billion in a second round of tax credit allocations for projects that expand clean energy manufacturing and recycling and critical materials refining, processing, and recycling, and for projects that reduce greenhouse gas emissions at industrial facilities. DOE’s Office of Manufacturing & Energy Supply Chains (MESC) manages the 48C(e) program on behalf of IRS and Treasury.

Below is additional information about the eligible projects under the 48C(e) program:

• Clean Energy Manufacturing and Recycling Projects: A qualifying advanced energy project in this category involves re-equipping, expanding, or establishing an industrial or manufacturing facility. The facility must manufacture or recycle one or more of the specified advanced energy properties outlined in the Round 2 guidance. Production of energy-intensive materials that have a substantially lower carbon intensity when compared to an appropriate industry-specific benchmark are now eligible under this category. Please review the guidance for an updated list of program priorities.
• Industrial Decarbonization Projects (formerly named Greenhouse Gas Emissions Reduction Projects): An advanced energy project qualifies under this category if it involves retrofitting an industrial or manufacturing facility, particularly in energy-intensive sectors such as cement, iron and steel, aluminum, and chemicals. The retrofit must include the installation of equipment specifically designed to reduce greenhouse gas emissions by at least 20 percent.
• Critical Materials Projects: A qualifying advanced energy project in this category re-equips, expands, or establishes an industrial facility for the processing, refining, or recycling of critical materials.

Concept papers and applications will be evaluated across multiple criteria and policy factors, including:

1. commercial viability;
2. greenhouse gas emissions impacts;
3. strengthening U.S. supply chains and domestic manufacturing for a net-zero economy; and
4. workforce and community engagement.

Approximately $2.5 billion of this second allocation round will be set aside for projects in designated 48C(e) energy communities, which includes communities with closed coal mines or coal plants. The program will provide an investment tax credit of up to 30% of qualified investments for certified projects that meet prevailing wage and apprenticeship requirements.

48C Energy Communities

Section 48C(e) Energy Communities Census Tracts are census tracts in which:

1. no pre-IRA 48C projects were located and
2. a coal mine has closed after December 31, 1999 or a coal-fired electric generating unit has been retired after December 31, 2009 or which is directly adjoining to any of these census tracts.