[Federal Register Volume 85, Number 93 (Wednesday, May 13, 2020)]
[Notices]
[Pages 28698-28699]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-10273]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service


Credit for Renewable Electricity Production, Refined Coal 
Production, and Indian Coal Production, and Publication of Inflation 
Adjustment Factors and Reference Prices for Calendar Year 2020

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Publication of inflation adjustment factors and reference 
prices for calendar year 2020 under sections 45(e)(2)(A) (26 U.S.C. 
45(e)(2)(A)), 45(e)(8)(C) (26 U.S.C. 45(e)(8)(C)), and 45(e)(10)(B) (26 
U.S.C. 45(e)(10)(B)) of the Internal Revenue Code.

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SUMMARY: The 2020 inflation adjustment factors and reference prices are 
used in determining the availability of the credit for renewable 
electricity production, refined coal production, and Indian coal 
production under section 45.

DATES: The 2020 inflation adjustment factors and reference prices apply 
to calendar year 2020 sales of kilowatt hours of electricity produced 
in the United States or a possession thereof from qualified energy 
resources, and to 2020 sales of refined coal and Indian coal produced 
in the United States or a possession thereof.
    Inflation Adjustment Factors: The inflation adjustment factor for 
calendar year 2020 for qualified energy resources and refined coal is 
1.6687. The inflation adjustment factor for calendar year 2020 for 
Indian coal is 1.2851.
    Reference Prices: The reference price for calendar year 2020 for 
facilities producing electricity from wind is 4.16 cents 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 $48.58 per ton for 
calendar year 2020. The reference prices for facilities producing 
electricity from closed-loop biomass, open-loop biomass, geothermal 
energy, municipal solid waste, qualified hydropower production, and 
marine and hydrokinetic renewable energy have not been determined for 
calendar year 2020.
    Phaseout Calculation: Because the 2020 reference price for 
electricity produced from wind (4.16 cents per kilowatt hour) does not 
exceed 8 cents multiplied by the inflation adjustment factor (1.6687), 
the phaseout of the credit provided in section 45(b)(1) does not apply 
to such electricity sold during calendar year 2020. Because the 2020 
reference price of fuel used as feedstock for refined coal ($48.58) 
does not exceed $90.49 (which is the $31.90 reference price of such 
fuel in 2002 multiplied by the inflation adjustment factor (1.6687) and 
1.7), the phaseout of the credit provided in section 45(e)(8)(B) does 
not apply to refined coal sold during calendar year 2020. Further, for 
electricity produced from closed-loop biomass, open-loop biomass, 
geothermal energy, municipal solid waste, qualified hydropower 
production, and marine and hydrokinetic renewable energy, the phaseout 
of the credit provided in section 45(b)(1) does not apply to such 
electricity sold during calendar year 2020.

[[Page 28699]]

    Credit Amount by Qualified Energy Resource and Facility, Refined 
Coal, and Indian Coal: As required by section 45(b)(2), the 1.5 cent 
amount in section 45(a)(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, landfill gas facilities, trash facilities, qualified 
hydropower facilities, and marine and hydrokinetic renewable energy 
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 2020 under section 45(a) is 2.5 cents per kilowatt hour on the 
sale of electricity produced from the qualified energy resources of 
wind, closed-loop biomass, and geothermal energy, and 1.3 cents per 
kilowatt hour on the sale of electricity produced in open-loop biomass 
facilities, landfill gas facilities, trash facilities, qualified 
hydropower facilities, and marine and hydrokinetic renewable energy 
facilities. Under the calculation required by section 45(b)(2), the 
credit for refined coal production for calendar year 2020 under section 
45(e)(8)(A) is $7.301 per ton on the sale of qualified refined coal. As 
required by section 45(e)(10)(B)(ii), the $2.00 amount in section 
45(e)(10)(B)(i) is adjusted by multiplying such amount by the inflation 
adjustment factor for the calendar year. Under the calculation required 
by section 45(e)(10)(B)(ii), the credit for Indian coal production for 
calendar year 2020 under section 45(e)(10)(B) is $2.570 per ton on the 
sale of Indian coal.

FOR FURTHER INFORMATION CONTACT: Charles Hyde, CC:PSI:6, Internal 
Revenue Service, 1111 Constitution Avenue NW, Washington, DC 20224, 
(202) 317-6853 (not a toll-free number).

Christopher T. Kelley,
Special Counsel to the Associate Chief Counsel (Passthroughs and 
Special Industries).
[FR Doc. 2020-10273 Filed 5-12-20; 8:45 am]
 BILLING CODE 4830-01-P