The joint program offers economic support to disadvantaged communities

Applications are open for the 2024 program year under the Low Income Communities Bonus Program. Led by the U.S. Department of Energy (DOE) Office of Energy Justice and Equity and the U.S. Department of the Treasury, these efforts promote cost-saving clean energy investments in low-income communities, supporting economic revitalization.

Both agencies established the credit bonus program for low-income communities under Internal Revenue Service (IRS) code under the Inflation Control Act. This section promotes cost-saving clean energy investments in low-income communities, prioritizing increased access to renewable energy facilities and the significant benefits of clean energy adoption.

Under this scheme, the Bonus Credit provides a 10 or 20 percentage point increase in investment tax credit for qualifying solar and wind facilities. The 10 percentage point increase is available for eligible solar and wind facilities installed in low-income communities or on Indian lands. A 20 percentage point credit increase is available for qualifying solar and wind facilities that are part of a qualifying low-income housing development or a qualified low-income economic benefit project.

Four different types of entities are eligible to apply: 1) entities located in a low-income community, 2) entities located in Indian territories, 3) a qualified low-income residential building project, and 4) a qualified low-income economic benefit project. The DOE will then review the applications and make recommendations to the IRS on who should receive the credit. The 30-day application period began on May 28, 2024 and will end on June 27. After this date, DOE will generally accept applications on a rolling basis. To learn more about applying, visit the program’s application portal.

As we move towards a clean energy economy, it is critical that underserved communities and main streets everywhere have the opportunity to transition so they are not left behind. This credit program could help cover these costs and energy suppliers and businesses in these areas should consider applying for it.