Renewable electricity, refined coal production inflation factors, reference prices for 2020
Renewable electricity, refined coal production
The U.S. Treasury Department and IRS today released for publication in the Federal Register a notice that provides the 2020 inflation adjustment factor and reference prices used in determining the availability of the credit for renewable electricity production and refined coal production under section 45.
Credit rates
Today’s notice [PDF 76 KB] provides:
- The 2020 credit rate for wind, closed-loop biomass and geothermal facilities claiming the renewable electricity production credit is 2.5 cents per kilowatt hour (the same as for 2019).
- The 2020 credit rate for open-loop biomass, landfill gas, trash, qualified hydropower and marine and hydrokinetic facilities is unchanged at 1.3 cents per kilowatt hour (the same as for 2019).
- The 2020 credit rate for refined coal production is $7.301 per ton on the sale of refined coal (up from $7.173 per ton for 2019).
Reference prices
- The inflation adjustment factor for 2020 for qualified energy resources and refined coal is 1.6687.
- The 2020 reference price for electricity produced from wind is 4.16 cents per kilowatt hour (reduced from 5.18 cents in 2019).
- The reference prices for fuel used as feed stock (relating to refined coal production) are $31.90 per ton for calendar year 2002 and $48.58 per ton for calendar year 2020 (down from $49.23 per ton for calendar year 2019).
- The reference prices for facilities producing electricity from closed-loop biomass, open-loop biomass, geothermal energy, small irrigation power, municipal solid waste, qualified hydropower production, and marine and hydrokinetic renewable energy have not been determined for calendar year 2020. According to today’s notice, the credit for electricity produced from wind and the credit for refined coal is not phased out for 2020 because the reference prices do not exceed the beginning of the phase-out threshold.
The credit rates and reference prices for 2020 are also provided in Notice 2020-38, which appears in Internal Revenue Bulletin 2020-23 [PDF 2.84 MB] (June 1, 2020).
For the 2019 factors and reference prices, read TaxNewsFlash
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