Energy credit for transformers designed to use soybean-based electrical transformer fluid

(a)

In general

Subparagraph (A) of section 48(a)(3) of the Internal Revenue Code of 1986 is amended by striking or at the end of clause (vi), by inserting or at the end of clause (vii), and by adding at the end the following new clause:

(viii)an electrical transformer which is designed to use, and contains, soybean-based electrical transformer fluid as the insulating fluid,

(b)

30 percent credit for replacement soybean-Based electrical transformer fluid

(1)

In general

Subsection (a) of section 48 of such Code is amended by adding at the end the following new paragraph:

(6)

Soybean-based electrical transformer fluid

For purposes of this subpart, the term energy property includes any soybean-based electrical transformer fluid— (A)used by the taxpayer as an insulating fluid in an electrical transformer owned or operated by the taxpayer, and (B)the original use of which commences with the taxpayer.

(2)

30 percent credit

Clause (i) of section 48(a)(2)(A) of such Code is amended by striking and at the end of subclause (III) and by adding at the end the following new subclause:

(V)any soybean-based electrical transformer fluid described in paragraph (6), and

(c)

Soybean-Based electrical transformer fluid

Subsection (c) of section 48 of such Code is amended by adding at the end the following new paragraph:

(5)

Soybean-based electrical transformer fluid

The term soybean-based electrical transformer fluid means any insulating fluid formulated for use in electrical transformers which— (A)is at least 95 percent soybean oil by volume, and (B)has received an environmental technology verification from the Administrator of the Environmental Protection Agency.

(d)

Effective date

The amendments made by this section shall apply to property placed in service in taxable years beginning after the date of the enactment of this Act.