Details of Public Law 116-260, section 132 , Extension and Phaseout of Energy Credit

Solar Energy Property

The provision extends the 30-percent energy credit for solar energy property used to generate electricity, to heat or cool (or provide hot water for use in) a structure, or to provide solar process heat, excepting use to heat a swimming pool, the construction of which begins before 1/1/2024. However, see below for the phase-out of this energy credit.

Extension of Fiber-Optic Solar Property

The provision extends the 30-percent energy credit for equipment that uses solar energy to illuminate the inside of a structure using fiber-optic distributed sunlight with respect to property the construction of which begins before 1/1/2024. However, see below for the phase-out of this energy credit.

Extension of Fuel Cell Property

The provision extends the 30-percent energy credit for qualified fuel cell property, with respect to property the construction of which begins before 1/1/2024. However, see below for the phase-out of this energy credit.

Extension of Qualified Small Wind Energy Property

The provision extends the 30-percent energy credit for qualified small wind energy property, with respect to property the construction of which begins before 1/1/2024. However, see below for the phase-out of this energy credit.

Extension of Thermal Energy Property

The provision extends the 10-percent energy credit for 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, with respect to property the construction of which begins before 1/1/2024.

Extension of Qualified Microturbine Property

The provision extends the 10-percent energy credit for qualified microturbine property, with respect to property the construction of which begins before 1/1/2024.

Extension of Combined Heat and Power System Property

The provision extends the 10-percent energy credit for combined heat and power system property, with respect to property the construction of which begins before 1/1/2024.

Phase-out of 30-Percent Credit Rate for Fiber-Optic Solar, Qualified Fuel Cell, and Qualified Small Wind Energy Property

The provision phases out the 30-percent energy credit for qualified fuel cell property, qualified small wind property, and fiber-optic solar property by reducing the credit percentage for each to 26 percent for any such property placed in service after 12/31/2021, and before 1/1/2023; and to 22 percent for any such property placed in service after 12/31/2022, and before 1/1/2024. Such property that is not placed in service before 1/1/2026, shall not be eligible for an energy credit.

Phase-out of 30-Percent Credit Rate for Solar Energy Property

The provision phases out the 30-percent energy credit for solar energy property by reducing the credit percentage for each to 26 percent for any such property placed in service after 12/31/2021, and before 1/1/2023; and to 22 percent for any such property placed in service after 12/31/2022, and before 1/1/2024. The credit percentage for property that is not placed in service before 1/1/2026, is 10 percent.