The Inflation Reduction Act’s (IRA) expansion of the investment tax credit (ITC) and the production tax credit (PTC) has continued to support the economic case for clean energy investment in the utility space, even in the face of sector-wide inflation and supply chain disruptions. Now, as details become available for other IRA provisions through clarifying IRS and Treasury guidance, industry participants can continue to identify opportunities for incremental federal support. For instance, for public utilities and electric cooperatives, recent guidance provides much needed clarity on the feasibility to construct low-income economic benefit projects (LIEBPs), which receive investment tax credits to cover at least 50% of a qualifying clean energy project’s capital cost.
CRA analysis has identified strong use cases for the LIEBP program among electric cooperatives and public utilities, citing new guidance which favors rural geographies, public ownership structures, and increased flexibility around regulatory approval. In the sections below, we outline the scope of the program and highlight near-term opportunities for public utilities to be successful first movers in unlocking significant savings for residential customers experiencing energy poverty.