HR 5807 — Making Imperiled Communities Resistant to Outages with Generation that is Resilient, Islandable, and Distributed Extension Act

(a) Energy credit (1) In general For purposes of section 46, except as provided in paragraphs (1)(B), (2)(B), and (3)(B) of subsection (c), the energy credit for any taxable year is the energy percentage of the basis of each energy property placed in service during such taxable year. (2) Energy percentage (A) In general Except as provided in paragraphs (6) and (7), the energy percentage is— (i) 6 percent in the case of— (I) qualified fuel cell property, (II) energy property described in clause (i) or (iii) of paragraph (3)(A) but only with respect to property the construction of which begins before January 1, 2025, (III) energy property described in paragraph (3)(A)(ii), (IV) qualified small wind energy property, (V) waste energy recovery property, (VI) energy storage technology, (VII) qualified biogas property, (VIII) microgrid controllers, and (IX) energy property described in clauses (v) and (vii) of paragraph (3)(A), and (ii) in the case of any energy property to which clause (i) does not apply, 0 percent. (B) Coordination with rehabilitation credit The energy percentage shall not apply to that portion of the basis of any property which is attributable to qualified rehabilitation expenditures. (C) Nonapplication of increases to energy percentage For purposes of energy property described in subparagraph (A)(ii), the energy percentage applicable to such property pursuant to such subparagraph shall not be increased or otherwise adjusted by any provision of this section. (3) Energy property For purposes of this subpart, the term “energy property” means any property— (A) which is— (i) equipment which uses solar energy to generate electricity, to heat or cool (or provide hot water for use in) a structure, or to provide solar process heat, excepting property used to generate energy for the purposes of heating a swimming pool, (ii) equipment which uses solar energy to illuminate the inside of a structure using fiber-optic distributed sunlight, or electrochromic glass which uses electricity to change its light transmittance properties in order to heat or cool a structure, but only with respect to property the construction of which begins before January 1, 2025, (iii) equipment used to produce, distribute, or use energy derived from a geothermal deposit (within the meaning of section 613(e)(2)), but only, in the case of electricity generated by geothermal power, up to (but not including) the electrical transmission stage, (iv) qualified fuel cell property or qualified microturbine property, (v) combined heat and power system property, (vi) qualified small wind energy property, (vii) equipment which uses the ground or ground water as a thermal energy source to heat a structure or as a thermal energy sink to cool a structure, but only with respect to property the construction of which begins before January 1, 2035, (viii) waste energy recovery property, (ix) energy storage technology, (x) qualified biogas property, or (xi) microgrid controllers, (B) (i) the construction, reconstruction, or erection of which is completed by the taxpayer, or (ii) which is acquired by the taxpayer if the original use of such property commences with the taxpayer, (C) with respect to which depreciation (or amortization in lieu of depreciation) is allowable, and (D) which meets the performance and quality standards (if any) which— (i) have been prescribed by the Secretary by regulations (after consultation with the Secretary of Energy), and (ii) are in effect at the time of the acquisition of the property. Such term shall not include any property which is part of a facility the production from which is allowed as a credit under section 45 for the taxable year or any prior taxable year. (4) Special rule for property financed by tax-exempt bonds Rules similar to the rule under section 45(b)(3) shall apply for purposes of this section. (5) Election to treat qualified facilities as energy property (A) In general In the case of any qualified property which is...