Production Tax Credit and Investment Tax Credit for Wind
The Production Tax Credit (PTC) provides a tax credit of 1¢–2¢ per kilowatt-hour for the first 10 years of electricity generation for utility-scale wind. The alternative Investment Tax Credit (ITC) provides a credit for 12%–30% of investment costs at the start of the project and is especially significant for the offshore and distributed wind sectors because such projects are more capital-intensive and benefit from the up-front tax benefits. In December 2020, Congress passed extensions of the PTC and ITC for 1 year. Additionally, Congress established a 30% ITC for any offshore wind project that begins construction by December 31, 2025 or began construction before January 1, 2017.
|If construction begins:||The estimated allowable tax credit is:|
|After Dec. 31, 2016||1.9 cents/kWh|
|By Dec. 31, 2017||1.8 cents/kWh|
|By Dec. 31, 2018||1.4 cents/kWh|
|By Dec. 31, 2019||1 cent/kWh|
|By Dec. 31, 2020||1.5 cents/kWh|
|By Dec. 31, 2021||1.5 cents/kWh|
For more information about federal incentives for developing and investing in wind power, resources for funding wind power, and opportunities to partner with DOE and other federal agencies, see the U.S. Wind Industry Federal Incentives, Funding, and Partnership Opportunities fact sheet.