To amend the Internal Revenue Code of 1986 to disallow the production tax credit and investment tax credit for offshore wind facilities placed in service in the inland navigable waters of the United States or the coastal waters of the United States.
This bill would eliminate federal tax incentives for offshore wind projects located in the United States’ inland navigable waters and coastal waters. Specifically, it would remove the investment tax credit (ITC) for offshore wind facilities by striking the relevant ITC provision, disallow the production tax credit (PTC) for offshore wind in those waters, and bar the Clean Electricity Production Credit (a newer form of the production credit) from applying to such facilities. The changes would apply to energy produced and property placed in service after December 31, 2025. In short, offshore wind projects located in inland navigable or coastal waters would no longer be able to claim these federal tax credits, potentially making those projects less financially attractive and shifting investment toward offshore wind located outside those waters or toward other energy sources.
Key Points
- 1ITC: The provision in Section 48(a)(5) that covers offshore wind property would be removed (the specific subparagraph being struck).
- 2PTC: Section 45(d)(1) would be amended to say that energy produced by offshore wind facilities located in inland navigable waters or coastal waters is not eligible for the production tax credit.
- 345Y/“Clean Electricity Production Credit”: A new subparagraph would be added stating that a disqualified offshore wind facility is one located in those same waters, effectively excluding it from the qualified facility status under the credit.
- 4Effective date: The changes apply to energy produced and property placed in service after December 31, 2025.
- 5Scope: The bill targets offshore wind facilities specifically located in inland navigable waters or coastal waters of the United States; offshore wind elsewhere would remain potentially eligible (subject to other rules).