Increase of credit

(a)

In general

Paragraph (2) of section 42(e) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:

(C)

Increase in credit for buildings achieving enhanced energy performance

(i)

In general

In the case of any existing building to which subsection (b)(2) does not apply which achieves enhanced energy performance, the rehabilitation expenditures taken into account under subparagraph (A) shall be 130 percent of such expenditures determined without regard to this subparagraph.(ii)

Enhanced energy performance

For purposes of clause (i), a building achieves enhanced energy performance if it meets either of the following:(I)The minimum requirements of an advanced building construction standard which shall be determined by the Secretary of Energy using prescriptive or performance methods of calculation and promulgated by the Secretary of Energy within 180 days of the date of the enactment of this subparagraph.(II)In the case of a taxpayer which elects (at such time and in such manner as the Secretary may provide) the application of this subclause with respect to the building, a qualified retrofit plan.(iii)

Definitions

For purposes of this subparagraph—(I)

Qualified retrofit plan

The term qualified retrofit plan means a written plan prepared and stamped by a qualified professional which specifies modifications to a building which, in the aggregate, are expected to reduce such building’s site energy usage intensity by 50 percent or more in comparison to the baseline energy usage intensity of such building. Such plan shall require a qualified professional to certify—(aa)the baseline energy usage intensity of the building,(bb)that the modifications are expected to reduce such building’s site energy usage intensity by 50 percent or more in comparison to the baseline energy usage intensity of such building, and(cc)as of any date following installation of building modifications, that such modifications have been installed.(II)

Baseline energy usage intensity

The term baseline energy usage intensity means the site energy usage intensity as of any date during the 24-month period immediately preceding the building modifications described in the qualified retrofit plan.(III)

Site energy usage intensity

The site energy usage intensity shall be determined for the entire building in accordance with such regulations or other guidance as the Secretary may provide and measured in British thermal units per square foot per year.(IV)

Qualified professional

The term qualified professional means an individual who is a licensed architect or a licensed engineer or meets such other requirements as the Secretary of Energy may provide.

(b)

Increase for buildings in high-Cost areas

Paragraph (2) of section 42(e) of the Internal Revenue Code of 1986, as amended by subsection (a), is further amended by adding at the end the following new subparagraph:

(D)

Special rule for buildings in high-cost areas which achieve enhanced energy performance

In the case of an existing building to which both subparagraph (C) and subsection (d)(5)(B) apply (but for this subparagraph)—(i)subsection (d)(5)(B)(i)(II) shall not apply, and(ii)the rehabilitation expenditures taken into account under subparagraph (A) shall be 160 percent of such expenditures determined without regard to this subparagraph.

(c)

Effective date

(1)

In general

Except as provided in paragraph (2), the amendments made by this section shall apply to buildings with respect to which housing credit dollar amounts are allocated after December 31, 2025.(2)

Bond-financed projects

In the case of any building some portion of which, or of the land on which the building is located, is financed by an obligation which is described in section 42(h)(4)(A) of the Internal Revenue Code of 1986, the amendments made by this section shall apply to any such building financed by such an obligation which is part of an issue the issue date of which is after December 31, 2025.