119 HR 9419 IH: Power and Water for Families Act of 2026
U.S. House of Representatives
2026-06-24
text/xml
EN
Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.
1.This Act may be cited as the Power and Water for Families Act of 2026
. 2.Congress finds the following:
(1)Artificial intelligence has the potential to drive economic growth, accelerate scientific and medical innovation, strengthen American competitiveness, and enhance the national security of the United States. (2)Maintaining American leadership in artificial intelligence over the Chinese Communist Party will require the responsible development of data centers and advanced computing infrastructure; and to do so, the United States is experiencing rapid growth in large electrical loads, including data centers and advanced computing facilities, some of which require power at a scale comparable to that of major metropolitan areas.
(3)The effects of new large electrical loads on electricity costs are not uniform across the United States and depend on regional resources, market structure, utility regulation, and the allocation of costs associated with serving such loads. Absent appropriate safeguards, such loads may place upward pressure on power costs, reduce access to Federal resources, and create risks to regional electric reliability. (4)The electric-power sector of the United States is characterized by diverse regional markets, resource mixes, utility structures, regulatory systems, and reliability needs. State regulatory authorities, nonregulated electric utilities, regional transmission organizations, and other relevant entities should retain flexibility to implement solutions appropriate to the communities they serve.
(5)Water reuse projects, including onsite water recycling systems within data center facilities and municipal water recycling systems, can protect aquifers by replacing the use of freshwater, such as rivers, streams and groundwater, with recycled water and support the responsible development of data centers and other industrial facilities. 3.It is the policy of Congress that—
(1)the United States should pursue an all-of-the-above strategy to develop the energy and water infrastructure required to maintain global leadership in artificial intelligence; (2)the United States should address demonstrated and localized infrastructure impacts through targeted, evidence-based measures rather than broad restrictions, blanket moratoria, or policies that impede responsible development;
(3)large-load customers should be encouraged to build, bring, or buy new and additive generation resources and should bear the full incremental cost of the infrastructure required primarily to serve their facilities; (4) the development of data centers and advanced computing facilities should be addressed through regionally appropriate policies that protect affordability and reliability while allowing responsible economic development; and
(5)water reuse should be encouraged through investment in projects that install, replace, or modify onsite water recycling systems, replace the use of freshwater with recycled water from a municipal water provider, or build or expand municipal water recycling systems. <enum>I</enum><header>POWER FOR FAMILIES</header> <section id="HA86AD641D07848C3A5A849A361E39ECA"><enum>101.</enum><header>Federal standard relating to large-load customers</header><text display-inline="no-display-inline">Section 111(d) of the Public Utility Regulatory Policies Act of 1978 (<external-xref legal-doc="usc" parsable-cite="usc/16/2621">16 U.S.C. 2621(d)</external-xref>) is amended by adding at the end the following:</text>
<quoted-block id="H91E863034A564CFEAE4B525056F6B8A7" style="OLC">
<paragraph id="H0090DB2641D6459C9430EDA85A7261E5"><enum>(22)</enum><header>Standards for large-load customers</header>
<subparagraph id="H5BB0F71839F3441581D667DDC630A7AD"><enum>(A)</enum><header>Recovery of full, incremental cost of upgrades</header><text>A rate charged, or entered into, by an electric utility for providing electric service to a large-load customer shall be designed to recover from the large-load customer the full, incremental cost of any generation, transmission, or distribution upgrade necessary to serve the load of such large-load customer, including in the event of such large-load customer terminating a contract with the electric utility pertaining to the sale of electric energy, or otherwise ceasing the purchase of electric energy from the electric utility.</text></subparagraph> <subparagraph id="HCA73793087F644DF850DC09F7C5846BC"><enum>(B)</enum><header>Financial assurances and contributions</header><text>Before making any generation, transmission, or distribution upgrade that is necessary to serve the load of a large-load customer, an electric utility shall require the large-load customer provide to the electric utility financial assurances or contributions to cover the cost of such upgrade.</text></subparagraph>
<subparagraph id="H8409314A4EF644B4B5D22EA97C4ECA81"><enum>(C)</enum><header>Large-load customer defined</header><text>In this paragraph, the term <quote>large-load customer</quote> means a non-residential retail electric customer that, on or after the date of the enactment of this paragraph, requests to enter into, or enters into, a contract pertaining to the sale of electric energy for one or more facilities that—</text> <clause id="H7BC58624AB6E49E0B3F913A8506F959D"><enum>(i)</enum><text>are behind a single point of interconnection; and</text></clause>
<clause id="HA464AD7F69A5454BBE7D2BA8E583B9A8"><enum>(ii)</enum><text>have, in the aggregate, a peak electric demand of 100 megawatts or more at a single site or campus.</text></clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block></section> <section id="H54A0319D8AED42CC97B4337B6A5CB1BA"><enum>102.</enum><header>Federal standard relating to additive generation for large-load customers</header><text display-inline="no-display-inline">Section 111(d) of the Public Utility Regulatory Policies Act of 1978 (<external-xref legal-doc="usc" parsable-cite="usc/16/2621">16 U.S.C. 2621(d)</external-xref>), as amended by section 101 of this Title, is further amended by adding at the end the following:</text>
<quoted-block id="HABDC9AEA1473474A9F42E296DA1C2139" style="OLC">
<paragraph id="H912587C8805F45CE822717BEB5D222B2"><enum>(23)</enum><header>Additive generation for large-load customers</header>
<subparagraph id="H6E7BBDE0405049C9994BC5246F98AEE4"><enum>(A)</enum><header>In general</header><text>Each electric utility shall consider the establishment of rates, contracts, tariffs, service agreements, or other mechanisms under which service to a large-load customer is encouraged or required to develop, acquire, finance, or contractually dedicate new or incremental generation resources sufficient to serve the projected load of such large-load customer and, where feasible, to provide additional capacity, energy, capacity attributes, or other resource benefits for the benefit of other customers.</text></subparagraph> <subparagraph id="HEEAD178B14314DACBD268A1624B2A163"><enum>(B)</enum><header>Additive generation incentive</header><text>In carrying out subparagraph (A), including as a means of satisfying or supplementing the standard described in paragraph (22), each electric utility shall consider mechanisms under which any capacity, energy, capacity attributes, or other resource benefits in excess of the projected load of such large-load customer may be made available, through long-term contracts or other market-based mechanisms, to load-serving entities serving residential, agricultural, small business, or other existing customers.</text></subparagraph>
<subparagraph id="HFFB4B5D1E808445CB278B6A005DEF515"><enum>(C)</enum><header>Flexible implementation</header><text>A State regulatory authority, with respect to each electric utility for which the State regulatory authority has ratemaking authority, and each nonregulated electric utility may implement the standard under this paragraph through—</text> <clause id="H3320F3C9E0254264A4D9A82A540A1A1F"><enum>(i)</enum><text>physical allocation of generating capacity;</text></clause>
<clause id="HCF114167FDE34015A3A902584ABF1C72"><enum>(ii)</enum><text>long-term power purchase agreements;</text></clause> <clause id="HA522D45FBC6849A0B73FEECA72F99C0E"><enum>(iii)</enum><text>contractual or financial arrangements;</text></clause>
<clause id="HCBC6AEE041014382A88E614EDCCBB5E1"><enum>(iv)</enum><text>market-based mechanisms;</text></clause> <clause id="H460061D4078941B9990F4362072FF906"><enum>(v)</enum><text>tariff conditions or special contracts for large-load customers; or</text></clause>
<clause id="H981D0676CAD749568543F9C61580901D"><enum>(vi)</enum><text>any other mechanism determined appropriate by the State regulatory authority or nonregulated electric utility.</text></clause></subparagraph> <subparagraph id="H48FCB4FCDEEB4AC79210AFC54277F9C8"><enum>(E)</enum><header>No mandatory resource allocation</header><text>Nothing in this paragraph shall be construed to require a State regulatory authority or nonregulated electric utility to mandate the physical allocation of generating capacity or to require a uniform percentage set-aside of new or incremental generation resources.</text></subparagraph>
<subparagraph id="H4F7FEBD3C34848BAB0E721859A5C633B"><enum>(F)</enum><header>Large-load customer defined</header><text>In this paragraph, the term <quote>large-load customer</quote> has the meaning given such term in paragraph (22)(C).</text></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block></section> <section id="H39F9721975994C2DAABA7EA4BAEDA94F"><enum>103.</enum><header>Obligations to consider and determine</header><text display-inline="no-display-inline">Section 112 of the Public Utility Regulatory Policies Act of 1978 (<external-xref legal-doc="usc" parsable-cite="usc/16/2622">16 U.S.C. 2622</external-xref>) is amended—</text>
<paragraph id="H0EF38F04F7FA4B4E9690ED3DEBC460CB"><enum>(1)</enum><text>in subsection (b), by adding at the end the following:</text> <quoted-block id="HD389A5DB7A734AADB65DCA2085B3D239" style="OLC"> <paragraph id="HC3C0FDF2A85343FDA66E8ED3A3D26C34"><enum>(9)</enum> <subparagraph id="HD9F9B2D69990454A915BF4FBB91A2820" display-inline="yes-display-inline"><enum>(A)</enum><text>Not later than 1 year after the date of enactment of this paragraph, each State regulatory authority (with respect to each electric utility for which the State has ratemaking authority) and each nonregulated electric utility shall commence consideration under section 111, or set a hearing date for consideration, with respect to the standard established by paragraph (22) of section 111(d).</text></subparagraph>
<subparagraph id="H80FD56868FB843C388EE0A2C63A64045" indent="paragraph">
<enum>(B)</enum>
<text>Not later than 2 years after the date of enactment of this paragraph, each State regulatory authority (with respect to each electric utility for which the State has ratemaking authority) and each nonregulated electric utility shall complete the consideration and make the determination under section 111 with respect to the standard established by paragraphs (22) and (23) of section 111(d).</text>
</subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block></paragraph>
<paragraph id="H44DFE88EE46940AEA811B54ACC8EE26B"><enum>(2)</enum><text>in subsection (c)—</text> <subparagraph id="H853E7923CBAE4A6B8A354CB806DAA514"><enum>(A)</enum><text>by striking <quote>subsection (b)(2)</quote> and inserting <quote>subsection (b)</quote>; and</text></subparagraph>
<subparagraph id="H518EB8C3CF524CC0B6EBA03735C3F4B0"><enum>(B)</enum><text>by inserting <quote>In the case of the standard established by paragraphs (22) and (23) of section 111(d), the reference contained in this subsection to the date of enactment of this Act shall be deemed to be a reference to the date of enactment of that paragraph (22) and (23).</quote> after <quote>paragraph (21).</quote>; and</text></subparagraph></paragraph> <paragraph id="HCC74FD0CDC2A43F88532DEA62E271E4A"><enum>(3)</enum><text>by adding at the end the following:</text>
<quoted-block id="H01808E5BDBAD44C8A10813B1FC6A7E1D" style="OLC">
<subsection id="HCAA8D086D7C3447BB4914D04B7C6AAFF"><enum>(i)</enum><header>Other prior state actions</header><text>Subsections (b) and (c) shall not apply to the standard established by paragraphs (22) and (23) of section 111(d) in the case of any electric utility in a State if, before the date of enactment of this subsection—</text> <paragraph id="H8FF25DF603E04705A6CFAE0AAEB75FAC"><enum>(1)</enum><text>the State has implemented for the electric utility the standard (or a comparable standard);</text></paragraph>
<paragraph id="HA69C066EF2074164AC917620DC37CC79"><enum>(2)</enum><text>the State regulatory authority for the State or the relevant nonregulated electric utility has conducted a proceeding to consider implementation of the standard (or a comparable standard) for the electric utility; or</text></paragraph> <paragraph id="HD8C49F11B91A4FE1B30621259A0303E6"><enum>(3)</enum><text>the State legislature has voted on the implementation of the standard (or a comparable standard) for the electric utility.</text></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block></paragraph></section>
<section id="H803F2AAC75AD4BE297A7B066B8412618"><enum>104.</enum><header>Prior and pending proceedings</header><text display-inline="no-display-inline">Section 124 of the Public Utility Regulatory Policies Act of 1978 (<external-xref legal-doc="usc" parsable-cite="usc/16/2634">16 U.S.C. 2634</external-xref>) is amended by adding at the end the following: <quote>In the case of the standard established by paragraph (22) of section 111(d), the reference contained in this section to the date of enactment of this Act shall be deemed to be a reference to the date of enactment of that paragraph (22).</quote>.</text></section> <section id="H274CA0B2FC55482FB50262EB4E88E1AD"><enum>105.</enum><header>Qualifying additive generation project credit</header> <subsection id="HB326F40151DC40B8B2E2D99D792A7F72"><enum>(a)</enum><header>In general</header><text>Subpart E of part IV of subchapter A of <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/1">chapter 1</external-xref> of the Internal Revenue Code of 1986 is amended by inserting after section 48F the following:</text>
<quoted-block id="HFA50F57224B54EEB85CEF9C24F25D528" style="OLC">
<section id="H45D47F1D15D848E7950D6D2612C3F86A"><enum>48G.</enum><header>Qualifying additive generation project credit</header>
<subsection id="H51A2069552B94B0FB5AE8E2C997C17F3"><enum>(a)</enum><header>In general</header><text>For purposes of section 46, the qualifying additive generation project credit for any taxable year is an amount equal to 30 percent of the qualified additive investment, as determined under subsection (b), for such taxable year.</text></subsection> <subsection id="H19A85AD493734BC995BDBF6642DD653F"><enum>(b)</enum><header>Qualified additive investment</header><text>For purposes of this section, the term <quote>qualified additive investment</quote> means the portion of the qualified investment in qualified property placed in service during the taxable year that is properly allocable to creditable excess capacity.</text></subsection>
<subsection id="H67CEC2C539AA4205BFE9AAC15474F870"><enum>(c)</enum><header>Creditable excess capacity</header><text>For purposes of this section, the term <quote>creditable excess capacity</quote> means the portion of new or incremental electric generation capacity that—</text> <paragraph id="H57B347B9B50D487A80347CBA07C1BBA1"><enum>(1)</enum><text>exceeds the projected peak electric demand of a covered large-load facility;</text></paragraph>
<paragraph id="H357D8714FF0744E29689ECA047841875"><enum>(2)</enum><text>is made available to one or more eligible load-serving entities pursuant to a long-term contract or other binding written agreement; and</text></paragraph> <paragraph id="HDDC7380FA260403387D4A073F8D55B6B"><enum>(3)</enum><text>does not exceed 50 percent of the projected peak electric demand of such covered large-load facility.</text></paragraph></subsection>
<subsection id="H7B65D3D519784A9EB93C531BDCBEE04F"><enum>(d)</enum><header>Qualifying additive generation project</header><text>For purposes of this section, the term <quote>qualifying additive generation project</quote> means a project that—</text> <paragraph id="HBFF4A85679C448CFBE6ECF1DA0E425B1"><enum>(1)</enum><text>develops, constructs, acquires, finances, or contractually dedicates new or incremental electric generation resources to support a covered large-load facility;</text></paragraph>
<paragraph id="H0D8C75B293A44DFA98321FFA7C714434"><enum>(2)</enum><text>makes creditable excess capacity available to one or more eligible load-serving entities; and</text></paragraph> <paragraph id="H5CB65BA9568445CC87F3F3031A9F6E7F"><enum>(3)</enum><text>does not shift generation, transmission, distribution, interconnection, stranded, or other infrastructure costs attributable to the covered large-load facility to existing residential, agricultural, small business, or other existing customers.</text></paragraph></subsection>
<subsection id="HEC572AE10F1345CE973E0BF1AF891175"><enum>(e)</enum><header>Verification and recapture</header>
<paragraph id="HB5882F384189410487C5D187A550A1F0"><enum>(1)</enum><header>Verification</header><text>No credit shall be allowed under this section unless the taxpayer certifies, in such form and manner as the Secretary may require, that—</text> <subparagraph id="H204C9C75105A40D59E65EBDFFCE42D27"><enum>(A)</enum><text>the projected peak electric demand of the covered large-load facility is supported by an engineering study, utility service agreement, interconnection study, or other documentation determined appropriate by the Secretary, in consultation with the Secretary of Energy;</text></subparagraph>
<subparagraph id="HC130F0BE55FD42D3977209F3E51CCD10"><enum>(B)</enum><text>the creditable excess capacity is subject to a long-term contract or other binding written agreement with one or more eligible load-serving entities; and</text></subparagraph> <subparagraph id="H48F1071ED8394159BBEC232E6216464C"><enum>(C)</enum><text>such creditable excess capacity is reasonably expected to be deliverable to such eligible load-serving entities.</text></subparagraph></paragraph>
<paragraph id="H6F08299CF4CA4B85BE61BB1DB1D7C697"><enum>(2)</enum><header>Recapture</header><text>The Secretary shall provide rules for the recapture of all or a portion of any credit allowed under this section if, during such period as the Secretary determines appropriate—</text> <subparagraph id="H863845826277472CADC0259D3EE860B0"><enum>(A)</enum><text>the taxpayer materially increases the electric demand of the covered large-load facility in a manner that reduces or eliminates the creditable excess capacity;</text></subparagraph>
<subparagraph id="H65234EDBC4AC4607A780BE7A4D767F4F"><enum>(B)</enum><text>the taxpayer terminates or materially reduces the long-term contract or other binding written agreement described in paragraph (1)(B); or</text></subparagraph> <subparagraph id="H00020F5FCB394FA4ABDA88443E465080"><enum>(C)</enum><text>the Secretary determines that the projected peak electric demand of the covered large-load facility was materially understated.</text></subparagraph></paragraph></subsection>
<subsection id="HBC270FF6C32E4B85973DACAFA5B0D33E"><enum>(f)</enum><header>Definitions</header><text>For purposes of this section—</text> <paragraph id="HCE67903A99174668845DDC8A87B26EE0"><enum>(1)</enum><header>Covered large-load facility</header><text>The term <quote>covered large-load facility</quote> means one or more nonresidential facilities behind a single point of interconnection that have, in the aggregate, a peak electric demand of 100 megawatts or more at a single site or campus.</text></paragraph>
<paragraph id="H1ADF515BFB7347149E7F6A51507B5514"><enum>(2)</enum><header>Eligible load-serving entity</header><text>The term <quote>eligible load-serving entity</quote> means an electric utility, public power utility, electric cooperative, municipal utility, investor-owned utility, Federal power marketing administration customer or preference customer, or any other load-serving entity determined appropriate by the Secretary.</text></paragraph> <paragraph id="H50CBEE30A04F419A966F304C12D5D365"><enum>(3)</enum><header>Long-term contract</header><text>The term <quote>long-term contract</quote> means a contract, tariff, service agreement, power purchase agreement, capacity agreement, or other binding written arrangement with a term of not less than 10 years.</text></paragraph>
<paragraph id="H4EF277AE7DE9429485C6DC7CBB641E6C"><enum>(4)</enum><header>Qualified property</header><text>The term <quote>qualified property</quote> means tangible property that is used as an integral part of a qualifying additive generation project, with respect to which depreciation or amortization is allowable, and the original use of which begins with the taxpayer.</text></paragraph></subsection> <subsection id="H97FD14466A4F491BAFEAE50CDFE8ED01"><enum>(g)</enum><header>Guidance</header><text>The Secretary, in consultation with the Secretary of Energy and the Federal Energy Regulatory Commission, shall issue such guidance as may be necessary to carry out this section, including guidance for determining qualified additive investment, projected peak electric demand, creditable excess capacity, deliverability, and prevention of cost shifting.</text></subsection>
<subsection id="HEEA2576356794FF4B58565AC23A13200"><enum>(h)</enum><header>Termination</header><text>This section shall not apply to any qualifying additive generation project placed in service more than 10 years after the date of enactment of this section.</text></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block></subsection> <subsection id="HE61F57AE171F4DD5BA3D6E6EC81621DB"><enum>(b)</enum><header>Part of investment credit</header><text><external-xref legal-doc="usc" parsable-cite="usc/26/46">Section 46</external-xref> of the Internal Revenue Code of 1986 is amended by adding at the end the following:</text>
<quoted-block id="H1CDFA2BC215A4D7CB28C0670AC6FA091" style="OLC">
<paragraph id="H033C2D91868E4C8D952380E754E8B155"><enum>(8)</enum><text>the qualifying additive generation project credit.</text></paragraph><after-quoted-block>.</after-quoted-block></quoted-block></subsection> <subsection id="H0726072500ED4B899A538723686ECE45"><enum>(c)</enum><header>Clerical amendment</header><text>The table of sections for subpart E of part IV of subchapter A of chapter 1 of such Code is amended by inserting after the item relating to section 48F the following:</text>
<quoted-block id="H0EA1CEC3398A4F6A9C99CF7CE37F6C30" style="OLC">
<toc regeneration="no-regeneration">
<toc-entry level="section">Sec. 48G. Qualifying additive generation project credit.</toc-entry></toc><after-quoted-block>.</after-quoted-block></quoted-block></subsection>
<subsection id="HA080575CA6114A2AA429DA25689F3976"><enum>(d)</enum><header>Effective date</header><text>The amendments made by this section shall apply to qualifying additive generation projects the construction of which begins after the date of enactment of this Act.</text></subsection></section> <enum>II</enum><header>ADVANCING WATER REUSE</header> <section id="H9EB4D536501B484B8DB6E88211D0E49B"><enum>201.</enum><header>Qualifying water reuse project credit</header> <subsection id="H1CAD7B75D7D9498CB12FB8E01431EF8B"><enum>(a)</enum><header>In general</header><text>Subpart E of part IV of subchapter A of <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/1">chapter 1</external-xref> of the Internal Revenue Code of 1986 is amended by inserting after section 48E the following new section:</text>
<quoted-block id="H3F9A06FA3A8346518D02978D2C7A0878" style="OLC">
<section id="H12CC382A03CC4076A5D7D8F0DC7DE776"><enum>48F.</enum><header>Qualifying water reuse project credit</header>
<subsection id="H99F2065CB1944BEF9A2AFA4022094E57"><enum>(a)</enum><header>In general</header><text>For purposes of section 46, the qualifying water reuse project credit for any taxable year is an amount equal to 30 percent of the qualified investment for such taxable year with respect to any qualifying water reuse project of the taxpayer.</text></subsection> <subsection id="H5A626359A16F45808AA9C8D50A081DAE"><enum>(b)</enum><header>Qualified investment</header> <paragraph id="H7EC9332EF6B9460FA755721690A21288"><enum>(1)</enum><header>In general</header><text>For purposes of subsection (a), the qualified investment with respect to any qualifying water reuse project for any taxable year is the basis of qualified property placed in service by the taxpayer during such taxable year which is part of such qualifying water reuse project.</text></paragraph>
<paragraph id="H5738878BE2BC41DF912805A0C10516F2"><enum>(2)</enum><header>Qualified property</header><text>For purposes of this subsection, the term <quote>qualified property</quote> means property—</text> <subparagraph id="H36D1B465B67A4D99B364F8F733CB8ACF"><enum>(A)</enum><text>which is tangible property,</text></subparagraph>
<subparagraph id="H4C91D5AC6D5E402D8829A6479AB80257"><enum>(B)</enum><text>with respect to which depreciation (or amortization in lieu of depreciation) is allowable, and</text></subparagraph> <subparagraph id="HD8B31E445F724A7C89968E3BB2D94E51"><enum>(C)</enum><text>which is—</text>
<clause id="H7A2BFA218C654F4F8CE3496A745D2B5F"><enum>(i)</enum><text>constructed, reconstructed, or erected by the taxpayer, or</text></clause> <clause id="H60961830A518477CA777A6E6E4A8D33A"><enum>(ii)</enum><text>acquired by the taxpayer if the original use of such property commences with the taxpayer.</text></clause></subparagraph></paragraph>
<paragraph id="HC10DF79AEE9442ADA27D75CC228E7EE8"><enum>(3)</enum><header>Certain qualified progress expenditures rules made applicable</header><text>Rules similar to the rules of subsections (c)(4) and (d) of section 46 (as in effect on the day before the enactment of the Revenue Reconciliation Act of 1990) shall apply for purposes of this section.</text></paragraph></subsection> <subsection id="H094B8ECF822C471BAD1D3315BA73E65F"><enum>(c)</enum><header>Qualifying water reuse project</header><text>For purposes of this section—</text>
<paragraph id="HF33802CC41F1451BB7FEED3AEE4772BA"><enum>(1)</enum><header>In general</header><text>The term <quote>qualifying water reuse project</quote> means a project which—</text> <subparagraph id="H1A0285AB03084305AB5AC5CDFB7696B2"><enum>(A)</enum><text>installs, replaces, or modifies an onsite water recycling system within an industrial, manufacturing, data center, or food processing facility,</text></subparagraph>
<subparagraph id="HA211BE6AC9EA4D73B378CE2FC27F5394"><enum>(B)</enum><text>replaces the use of freshwater, such as groundwater, with recycled water from a municipal water provider for the production of goods or provision of services by the taxpayer, or</text></subparagraph> <subparagraph id="H9C9D22F8494F4EE4AC1F382472FF83A5"><enum>(C)</enum><text>builds or expands a municipal water recycling system for the purpose of securing recycled water for the production of goods or provision of services.</text></subparagraph></paragraph>
<paragraph id="H345449AA16044F16AD63429F1B798347"><enum>(2)</enum><header>Water recycling system</header><text>The term <quote>water recycling system</quote> means infrastructure needed for the production, storage, conveyance, and use of recycled water.</text></paragraph> <paragraph id="HEDCC03051BDA40578D0020445357EA19"><enum>(3)</enum><header>Recycled water</header><text>The term <quote>recycled water</quote> means former wastewater, including both industrial and municipal wastewater, that has been treated and cleaned for a specific beneficial use.</text></paragraph></subsection>
<subsection id="HA676D63D0F9F4101BAE6812983861F57"><enum>(d)</enum><header>Special rule for certain property transferred to utilities</header>
<paragraph id="H31FE51AABE5240F2AF61C22C2C9E8FC0"><enum>(1)</enum><header>In general</header><text>In the case of any qualified transfer property transferred from a person to a utility—</text> <subparagraph id="H0CEC7E435D3142AB93FA7A79F57351C6"><enum>(A)</enum><text>such property shall be treated as qualified property with respect to such person,</text></subparagraph>
<subparagraph id="HBA10A3C51AD1496BA6CB317E0FBFCED6"><enum>(B)</enum><text>such person shall be treated as having placed such property in service at the time of such transfer,</text></subparagraph> <subparagraph id="HB3F5C994BE404632B3BCA2A3B2A50C00"><enum>(C)</enum><text>the basis of such person in such property which is taken into account under subsection (b)(1) shall be the basis of such person in such property at the time of such transfer, and</text></subparagraph>
<subparagraph id="H9499972834A84218B7130403B7EC583A"><enum>(D)</enum><text>such property shall not be taken into account for purposes of determining any credit allowed under this section to such utility.</text></subparagraph></paragraph> <paragraph id="HD1CF5EFD04C841BAA64027C9C5D7710C"><enum>(2)</enum><header>Qualified transfer property</header><text>For purposes of this subsection, the term <quote>qualified transfer property</quote> means property transferred from a person to a utility if—</text>
<subparagraph id="H5A970C600DA447CAA333BC2157A77455"><enum>(A)</enum><text>such property is qualified property with respect to such utility, and</text></subparagraph> <subparagraph id="HE1E74949CC874D77A8D8E42A5FD7B8ED"><enum>(B)</enum><text>such person and such utility enter into a binding written agreement under which such person is treated as eligible for the credit allowed under this section with respect to such property in lieu of such utility.</text></subparagraph></paragraph></subsection>
<subsection id="HB06E2F5BC4C64E8E875636A422CC4377"><enum>(e)</enum><header>Termination</header><text>This section shall not apply to any qualified investment with respect to any qualifying water reuse project unless such project is placed in service not later than the date which is 10 years after the date of the enactment of this section.</text></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block></subsection> <subsection id="H8D5F27FFBE754DDDA2E938E03DB8D570"><enum>(b)</enum><header>Part of investment credit</header><text>Section 46 of such Code is amended by striking <quote>and</quote> at the end of paragraph (7), by striking the period at the end of paragraph (8) and inserting <quote>, and</quote>, and by adding at the end the following new paragraph:</text>
<quoted-block id="HD7FB094E31CD4C9D88A5945CA8C8598A" style="OLC">
<paragraph id="H83ED7417E01E4203995B18D6EA947E8F"><enum>(9)</enum><text>the qualifying water reuse project credit.</text></paragraph><after-quoted-block>.</after-quoted-block></quoted-block></subsection> <subsection id="HCB2CD647E9CF4760AD489275686AA66D"><enum>(c)</enum><header>Clerical amendment</header><text>The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by inserting after the item relating to section 48E the following new item:</text>
<quoted-block id="HCA3A8918399B459BA48FEBCC4D0C289C" style="OLC"><after-quoted-block>.</after-quoted-block></quoted-block></subsection>
<subsection id="HCF43F79A71F84D4889BA57DEC0A44CE4"><enum>(d)</enum><header>Effective date</header><text>The amendments made by this section shall apply to qualifying water reuse projects (as defined in <external-xref legal-doc="usc" parsable-cite="usc/26/48F">section 48F</external-xref> of the Internal Revenue Code of 1986, as added by this section) the construction of which begins after the date of the enactment of this Act.</text></subsection></section>