Summary of HR 1462: Amendment to the Internal Revenue Code Regarding Offshore Wind Facilities
Bill Overview
Bill Number: HR 1462
Title: To amend the Internal Revenue Code of 1986 to disallow the production tax credit and investment tax credit for offshore wind facilities placed in service in the inland navigable waters of the United States or the coastal waters of the United States.
Introduced: February 21, 2025
Status: Introduced in House
Primary Sponsor: Pat Fallon
Cosponsors: Brandon Gill, Harriet M. Hageman, Lance Gooden
Purpose and Intent
The primary intent of HR 1462 is to amend the Internal Revenue Code to eliminate certain tax incentives for offshore wind facilities that are located in specific U.S. waters. The bill seeks to disallow the production tax credit (PTC) and investment tax credit (ITC) for offshore wind projects situated in the inland navigable waters and coastal waters of the United States.
Key Provisions
The bill proposes the following amendments to the Internal Revenue Code:
Amendment to Section 48(a)(5):
- Strikes subparagraph (F), which may pertain to the eligibility criteria for tax credits.
Amendment to Section 45(d)(1):
- Modifies the definition of eligible facilities by adding a clause that excludes any facility located in the inland navigable waters or coastal waters from receiving tax credits.
Addition to Section 45Y(b)(1):
- Introduces a new subparagraph defining "disqualified offshore wind facility" as any offshore wind facility located in the inland navigable waters or coastal waters, thus explicitly excluding them from being considered as "qualified facilities."
Effective Date:
- The amendments will apply to energy produced and property placed in service after December 31, 2025.
Impact
Who Would Be Affected?
- Offshore Wind Developers: Developers of offshore wind facilities located in the specified waters would be directly impacted, as they would no longer be eligible for significant federal tax incentives.
- Energy Sector: The bill could influence investment decisions within the renewable energy sector, particularly for offshore wind projects.
- State and Local Economies: Regions that may have benefited from offshore wind development could see reduced economic activity related to these projects.
Broader Implications
- The bill reflects a legislative shift in how offshore wind energy projects are incentivized, potentially affecting the growth of renewable energy sources in the U.S. and the transition to cleaner energy.
Legislative Actions
- February 21, 2025: The bill was introduced and referred to the House Committee on Ways and Means for further consideration.
Related Legislation
- HR 2187: A companion bill that may address similar issues or provide alternative approaches to offshore wind facility incentives.
This summary provides a clear overview of HR 1462, detailing its purpose, key provisions, and potential impacts on the offshore wind energy sector and related stakeholders.
