[Federal Register Volume 70, Number 67 (Friday, April 8, 2005)]
[Notices]
[Page 18071]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-7096]



[[Page 18071]]

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DEPARTMENT OF THE TREASURY

Internal Revenue Service


Credit for Renewable Electricity Production and Refined Coal 
Production, Publication of Inflation Adjustment Factor and Reference 
Prices for Calendar Year 2005

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Publication of inflation adjustment factor and reference prices 
for calendar year 2005 as required by section 45(e)(2)(A) (26 U.S.C. 
45(e)(2)(A)) and section 45(e)(8)(C) (26 U.S.C. 45(e)(8)(C)).

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SUMMARY: The 2005 inflation adjustment factor and reference prices are 
used in determining the availability of the credit for renewable 
electricity production and refined coal production under section 45.

DATES: The 2005 inflation adjustment factor and reference prices apply 
to calendar year 2005 sales of kilowatt hours of electricity produced 
in the United States or a possession thereof from qualified energy 
resources, and to 2005 sales of refined coal produced in the United 
States or a possession thereof.
    Inflation Adjustment Factor: The inflation adjustment factor for 
calendar year 2005 is 1.2528.
    Reference Prices: The reference price for calendar year 2005 for 
facilities producing electricity from wind is 4.85[cent] per kilowatt 
hour. The reference prices for fuel used as feedstock within the 
meaning of section 45(c)(7)(A) (relating to refined coal production) 
are $31.90 per ton for calendar year 2002 and $36.36 per ton for 
calendar year 2005. The reference prices for facilities producing 
electricity from closed-loop biomass, open-loop biomass, geothermal 
energy, solar energy, small irrigation power, and municipal solid waste 
have not been determined for calendar year 2005. The IRS is exploring 
methods of determining those reference prices for calendar year 2006.
    Because the 2005 reference price for electricity produced from wind 
does not exceed 84 multiplied by the inflation adjustment factor, the 
phaseout of the credit provided in section 45(b)(1) does not apply to 
such electricity sold during calendar year 2005. Because the 2005 
reference price of fuel used as feedstock for refined coal does not 
exceed the $31.90 reference price of such fuel in 2002 multiplied by 
the inflation adjustment factor and 1.7, the phaseout of credit 
provided in section 45(e)(8)(B) does not apply to refined coal sold 
during calendar year 2005. Further, for electricity produced from 
closed-loop biomass, open-loop biomass, geothermal energy, solar 
energy, small irrigation power, and municipal solid waste, the phaseout 
of credit provided in section 45(b)(1) does not apply to such 
electricity sold during calendar year 2005.
    Credit Amount By Qualified Energy Resource and Facility, and 
Refined Coal: As required by section 45(b)(2), the 1.5[cent] amount in 
section 45(a)(1), the 84 amount in section 45(b)(1), and the $4.375 
amount in section 45(e)(8)(A) are each adjusted by multiplying such 
amount by the inflation adjustment factor for the calendar year in 
which the sale occurs. If any amount as increased under the preceding 
sentence is not a multiple of 0.1[cent], such amount is rounded to the 
nearest multiple of 0.1[cent]. In the case of electricity produced in 
open-loop biomass facilities, small irrigation power facilities, 
landfill gas facilities, and trash combustion facilities, section 
45(b)(4)(A) requires the amount in effect under section 45(a)(1) 
(before rounding to the nearest 0.1[cent]) to be reduced by one-half. 
Under the calculation required by section 45(b)(2), the credit for 
renewable electricity production for calendar year 2005 under section 
45(a) is 1.9[cent] per kilowatt hour on the sale of electricity 
produced from the qualified energy resources of wind, closed-loop 
biomass, geothermal energy, and solar energy, and 0.9[cent] per 
kilowatt hour on the sale of electricity produced in open-loop biomass 
facilities, small irrigation power facilities, landfill gas facilities, 
and trash combustion facilities. Under the calculation required by 
section 45(b)(2), the credit for refined coal production for calendar 
year 2005 under section 45(e)(8)(A) is $5.481 per ton on the sale of 
qualified refined coal.

FOR FURTHER INFORMATION CONTACT: David A. Selig, IRS, CC:PSI:5, 1111 
Constitution Ave., NW., Washington, DC 20224, (202) 622-3040 (not a 
toll-free call).

Heather C. Malloy,
Associate Chief Counsel, (Passthroughs & Special Industries).
[FR Doc. 05-7096 Filed 4-7-05; 8:45 am]
BILLING CODE 4830-01-P