Credit for Renewable Energy Investment and Production for Self-Consumption by International Operations Centers (Corporate)

Summary

S.B. 1484 of 2014 provides a tax credit for new renewable energy systems that produce energy for self-consumption and are used primarily for manufacturing. H.B. 2670 of 2015 expanded this credit to include renewable energy systems that produce energy for self-consumption by “international operations centers”. H.B. 2528 of 2017 removes eligibility for manufacturers beginning in 2018.

H.B. 2429 of 2021 renamed the credit to "credit for renewable energy investment and production for self-consumption by international operations centers" and required all minimum investments to be completed within three years of the application submission or December 31, 2018, whichever is earlier. The original completion period was within three years of application submission or December 31, 2030. H.B. 2649 of 2021 added battery storage as an eligible technology (both standalone and generation + storage systems). It also allows investment by utilities to count towards the credit, as long as the utility-owned renewable energy facilities are developed on behalf of or for the direct benefit of the international operations center.

Eligible systems must have a capacity of at least 20 megawatts (MW) or have a typical annual generation of at least 40,000 megawatt-hours (MWh). The tax credit is worth $5 million per year for five years for each facility. 

Taxpayers must first apply to the Department of Revenue on a form prescribed by the Department. The Department will pre-approve taxpayers on a first-come, first-served basis until it has pre-approved a total of $10 million credits in each year. Program guidelines and application for pre-approval of the credit are available here. 

International Operations Centers

To qualify as an international operations center, the owner or operator must make a minimum annual investment of $100 million in new capital assets in each of ten consecutive years. Investments greater than $100 million in any taxable year may be carried forward as a credit toward the investment requirements of subsequent years. On or before the tenth anniversary of certification as an international operations center, the owner or operator must make a total investment of at least $1.25 billion in new capital assets. In order to qualify for a tax credit, the international operations center must invest at least $100 million in new renewable energy facilities. By the fifth year the system is in operation, at least 51% of the energy must be used on-site.

For the purposes of this tax credit, renewable energy includes a variety of biomass resources, solar thermal electric, solar photovoltaics, and wind.