The American Public Power Association on May 8 released the Elective Pay Blueprint for Public Power, which provides guidance to public power utilities that are considering the development of projects relying on elective payment of energy tax credits.
Elective payment of energy tax credits was enacted in 2022 after decades of work by APPA and its members. In turn, the Blueprint stems from years of work understanding the new law and provides guidance for taking advantage of the credits.
“Energy tax credits via elective payment represent a sea change in terms of how public power communities affordably finance infrastructure products,” said APPA President & CEO Scott Corwin. “This Blueprint is essentially a manual for using this powerful new tool.”
The Blueprint is a unique resource for public power utilities to navigate elective payment for energy tax credits.
It includes specific guidance on:
• Qualifications for elective payment;
• Energy credits and applicable bonus credits;
• Key concepts like domestic content, wage, and apprenticeship requirements;
• The mechanics of filing elective payment returns;
• Comparisons between investment and production tax credits, and financing with tax-exempt vs. taxable debt; and
• Additional external information resources.
It also includes a walkthrough of a project's lifecycle and strategies to avoid complexities, such as limiting project size and engaging contractors or suppliers for support.
Funded in part by the Department of Energy’s “Elective Pay – Blueprints for Communities” grant program, the Blueprint was written by the American Public Power Association with Brownstein Hyatt Farber Schreck, LLP, Ernst & Young, LLP, PFM Financial Advisors, LLC, and Orrick, Herrington & Sutcliffe, LLP.
The Blueprint is part of APPA’s broader elective payment education and advocacy efforts.
As part of both, APPA has been a leader in providing information to other stakeholders and policymakers about elective payment with goals of helping in its use, but also in advocating for its retention and improvement.
APPA members can download the guidance at: https://www.publicpower.org/resource/elective-pay-blueprint-public-power
