The IRS has published the inflation adjustment factors and reference prices to be used in computing the renewable electricity production credit for calendar year 2012. The inflation adjustment factors and references prices apply to sales in calendar year 2012 of kilowatt hours of electricity produced in the United States or a U.S. possession from qualified energy resources, and to 2012 sales of refined coal and Indian coal produced in the U.S. or one of its possessions.
The inflation adjustment factor for calendar year 2012 is 1.4799 for qualified energy resources and refined coal, and 1.1336 for Indian coal. The reference price for calendar year 2012 is 5.31 cents per kilowatt hour for facilities producing electricity from wind. The reference price for fuel used as feedstock for refined coal production within the meaning of Code Sec. 45(c)(7)(A) is $55.80 per ton for calendar year 2012. However, the reference prices for facilities producing electricity from closed-loop biomass, open-loop biomass, geothermal energy, solar energy, small irrigation power, municipal solid waste, qualified hydropower production, and marine and hydrokinetic energy have not been determined for calendar year 2012.
The amount of the credit for calendar year 2012 is 2.2 cents per kilowatt hour on sales of electricity produced from wind energy, closed-loop biomass, geothermal energy and solar energy, and 1.1 cents per kilowatt hour on sales of electricity produced from open-loop biomass, small irrigation power, landfill gas, trash combustion, qualified hydropower, and marine and hydrokinetic energy facilities. The credit for refined coal production is $6.475 per ton of qualified refined coal sold in 2012. The credit for Indian coal production is $2.267 per ton of Indian coal sold in 2012.
The renewable electricity production credit is not subject to a phaseout under Code Sec. 45(b) for electricity sold during calendar year 2012. This is because none of the 2012 reference prices for wind, refined coal, biomass, solar, geothermal, hydroelectric, marine and hydrokinetic, small irrigation, and municipal solid waste exceed the base amounts multiplied by the inflation adjustment factor.
Notice of Credit for Renewable Electricity Production, Refined Coal Production, and Indian Coal Production, and Publication of Inflation Adjustment Factors and Reference Prices for Calendar Year 2012, 2012FED ¶46,343
Code Sec. 45
CCH Reference – 2012FED ¶4415.25
Tax Research Consultant
CCH Reference – TRC BUSEXP: 54,550
CCH Reference – TRC BUSEXP: 54,554
CCH Reference – TRC BUSEXP: 54,554.15