HB 4031 – Exempts an energy facility from needing a site certificate from the Energy Facility Siting Council if the energy facility produces power from a renewable energy source, qualifies for certain federal renewable energy tax credits and construction begins on or before December 31, 2028.
The bill creates a new exemption for renewable energy facilities (solar, wind, geothermal, or marine energy) that meet specific conditions:
- Local approval: The facility must receive land use approval from the local government
- Federal tax credit qualification: Construction must begin by December 31, 2028, in a way that qualifies for federal renewable energy tax credits (IRS sections 45, 45Y, 48, or 48E)
- Notification requirement: The developer must notify both the local government and EFSC that construction has begun and qualifies for these tax credits
Local government involvement doesn’t mean they have control. They are just authorized to handle the permitting instead of requiring state-level EFSC approval, which is typically a more extensive and time-consuming process. It has the potential of forcing local governments to go against the will of their residence.
On July 7, 2025, President Trump issued an executive order directing the Treasury Department to strictly enforce the termination of solar and wind credits and issue new guidance to prevent circumvention of the “beginning of construction” rules.
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Solar and wind projects are no longer eligible for the 45Y and 48E credits if they:
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Begin construction after July 4, 2026, or
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Are not placed in service by December 31, 2027.
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Projects that began construction before July 4, 2026, and are placed in service by December 31, 2027, can still claim the credits.
Why did LC permit this bill to be introduced when it clearly does not comply with federal timelines?