More substation equipment than many companies thought earlier qualifies for a Treasury cash grant or investment tax credit at a wind or solar project.

Most developers filing for Treasury cash grants have been treating the cost of equipment through the transformer that steps up electricity to transmission voltage as eligible for cash grants.

The IRS said in an internal memo during the summer that it will also treat circuit breakers, surge arrestors and other equipment on the high side of the step-up transformer as eligible since the equipment protects the transformer from damage. It said the devices are “power conditioning” equipment. Such equipment qualifies for tax subsidies.

The position is in Chief Counsel Advice 201122018.

Ellen Neubauer, the cash grants program manager, said that companies cannot apply for additional grants on projects on which grants have already been paid.

Keith Martin