Last month the Internal Revenue Service today announced 312 projects that are now eligible to be financed with tax-credit bonds under the Clean Renewable Energy Bonds (CREB) program. Approximately, $477 million was available for this round of applications. The CREB program was created by the Energy Tax Incentives Act of 2005 and expanded under the Tax Relief and Health Care Act of 2006.
The IRS reviewed applications for nearly twice the amount that was available. This second round of applications included 342 from 33 states, pertaining to 395 projects.
In November 2006, the IRS announced the first round of projects, which allocated $800 million of volume cap (some of which was subsequently relinquished) to 610 projects. State and local governments as well as electrical cooperatives are able to issue tax-credit bonds under the program.
Internal Revenue Code Section 54 authorized the total allocation of $1.2 billion of tax-credit bond volume cap to fund projects that can generate clean renewable energy. State and local government borrowers are limited to no more than $750 million of the volume cap with the rest going to qualified mutual or cooperative electric companies.
The other nice feature outside of favoring public entities is that CREB volume cap allocations are awarded on a “smallest-to-largest” project basis.
There were 156 proposed projects in California, 57 in Minnesota, 23 in New Jersey, 17 in Washington, 13 in Nebraska, 12 in Montana, 11 in Illinois and 10 in Wisconsin. Applications ranged in size from $15,000 to $38.5 million.
Governmental borrowers submitted applications totaling $728 million to finance 367 projects with an average project size of about $2 million. Governmental borrowers in 28 states will receive $263 million of volume cap allocations ranging from $15,000 to $2.95 million. Approved projects of governmental borrowers include: 138 solar facilities, 88 wind facilities, 41 landfill gas facilities, 12 hydropower facilities, three closed-loop biomass facilities, three trash combustion facilities and one open-loop biomass facility.
Cooperative borrowers submitted applications totaling about $170 million to finance 28 projects with an average project size of about $6.1 million. Cooperative borrowers will receive about $143 million of volume cap allocations for projects in 13 states ranging from $300,000 to $30 million. Approved cooperative projects include: 14 wind facilities, four landfill gas facilities, six hydropower facilities, one solar facility and one open-loop biomass facility.
The latest round of applicants were given the option for the IRS to disclose their information publicly and 310 projects signed the consent form. A list of projects can be found at the link below.
- 2007 Disclosure of CREB Allocations – published by theIRS