Section 48A Qualifying Advanced Coal Project Credit

Last updated: 29 June 2020

The United States Qualifying Advanced Coal Project Credit legislation (Title 26, United States code (U.S.C.) 48A) includes investment tax credits aimed at reducing CO2 emissions by incentivizing efficiency upgrades at coal-fired power plants.


The credit amount is 20% for integrated gasification combined cycle (IGCC) projects and 15% for other advanced coal-based projects that produce electricity. The incentive also encourages investment in clean coal gasification projects (Qualifying Gasification Project Credit, 26 U.S.C. 48B) for industry (non power-producing uses) for which the credit is 20-30%.


Currently, the requirement for improved efficiency means that most CCUS-retrofits using post-combustion capture technology would not be eligible for the 48A tax credit. While CCUS would significantly reduce the emissions of the plant, the energy needs of the capture unit can result in a reduction in overall plant efficiency.  Proposed amendments to Section 48A (contained in the Carbon Capture Modernization Act (S. 407 and H.R. 1796)) would make technical modifications to the legislation to enable CCUS retrofits to coal plants to be eligible.

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