§45J Credit for production from advanced nuclear power facilities

Summary

You can get a tax credit of 1.8 cents for every kilowatt-hour of electricity a taxpayer makes at an advanced nuclear power plant during the first 8 years after the plant starts service, as long as the electricity is sold to someone who is not related to the seller. There is a national cap of 6,000 megawatts that the Secretary allocates among projects. The Secretary must write rules within 6 months after the law is passed and work with the Energy Department. Any unused part of the 6,000 megawatts after December 31, 2020 will be reassigned first to plants in service on or before that date that didn’t get full allocation, then to plants that come into service later. A facility’s credit is reduced if it gets fewer allocated megawatts than its total nameplate capacity. Also, a facility’s credit for a year cannot exceed a share of $125,000,000 based on its allocated megawatts out of 1,000. The credit is lowered when the yearly market reference price goes above 8 cents. The excess above 8 cents is compared to 3 cents to cut the credit proportionally. The 8-cent trigger is adjusted for inflation and rounded to the nearest 0.1 cent. Eligible facilities must be owned by the taxpayer, use nuclear energy, be placed in service after the law’s enactment and before January 1, 2021, and have a reactor design approved after December 31, 1993 that was not previously approved. Definitions (one line each): advanced nuclear power facility—an owned nuclear electricity plant placed in service in the covered period; advanced nuclear facility—a plant whose reactor design was approved after December 31, 1993; qualified public entity—governmental or certain nonprofit electric entities that can elect to transfer the credit; eligible project partner—a person involved in design, construction, supply, financing, or ownership who can receive the credit. Similar timing and partnership rules that apply to other clean-energy credits also apply here.