On March 31, 2021, President Biden released a fact sheet on his proposed $2.3 trillion initiative known as the American Jobs Plan. The plan includes spending to upgrade the electric grid and promote renewable energy. Highlights of the plan include the following:
- Increase the corporate income tax rate from 21 percent to 28 percent
- Targeted investment tax credit that incentivizes the buildout of at least 20 gigawatts of high-voltage-capacity power lines
- 10-year extension and phasedown of an expanded direct-pay investment tax credit and production tax credit for clean energy generation and storage
- Pair investment in 15 decarbonized hydrogen demonstration projects in distressed communities with a new production tax credit to spur capital-project retrofits and installations
- Establish 10 pioneer facilities that demonstrate carbon capture retrofits for large steel, cement and chemical production facilities
- Reform and expand the Section 45Q tax credit, making it direct pay and easier to use for hard-to-decarbonize industrial applications, direct air capture and retrofits of existing power plants
McGuireWoods lawyers are experienced in energy, project finance and tax equity structures. Do not hesitate to reach out if your business would like to discuss any of the above information.