The Inflation Reduction Act (IRA) that President Biden signed into law on August 16 ran, all told, about 725 pages. One of the more complex and—for businesses—interesting portions of this law involves its restructuring and expanding of clean-energy tax credits, which may provide opportunities for companies operating in and around the clean-energy area.
The IRA increased the tax credits’ appeal by extending them at full value for 10 years; the credits only decline once power-sector carbon emissions fall to 75% of today’s levels. It also expanded the scope of these credits, allowing almost any new zero-emissions project to qualify for either Production Tax Credits, Investment Tax Credits, or both.
One of the IRA’s most significant changes to clean-energy tax credits allows those credits to be conveyed to third-party entities through “transferability,” which…