PTCs: 2019 inflation adjustment
Production tax credits for some renewable energy projects will be slightly higher in 2019.
Credits for producing refined coal are also increasing.
The credits for generating electricity from wind, geothermal steam or fluid or closed-loop biomass (plants grown to be used as fuel in power plants) are 2.5¢ a kilowatt hour in 2019 compared to 2.4¢ in 2018. They will remain unchanged at 1.2¢ a kilowatt hour for generating electricity from open-loop biomass, landfill gas, incremental hydropower and ocean energy.
The credits are adjusted each year for inflation as measured by the GDP price deflator. They run for 10 years after a project is originally placed in service.
The credits phase out if contracted electricity prices from a particular resource reach a certain level. That level for wind in 2019 is 13.1168¢ a KWh. The IRS said there will not be any phase out in 2919 because contracted wind electricity prices are 5.18¢ a KWh going into 2019. It said it lacks data on contracted prices for electricity from the other energy sources.
Production tax credits for producing refined coal are $7.173 a ton in 2019. Refined coal is coal that has been treated with chemicals to make it less polluting than regular coal. The IRS said there will not be any phase out of refined coal credits in 2019. The refined coal credit phases out as the reference price for raw coal moves above 1.7 times the 2002 price of raw coal. The 2019 reference price is $49.23 a ton. A phase out would have started at $88.92 a ton.
The tax credit amounts were in a notice published in the Federal Register on June 6.