Sec. 5041. Clean Energy Bonds
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Subpart J of part IV of subchapter A of chapter 1 is amended by adding at the end the following new section: If a taxpayer holds a clean energy bond on one or more interest payment dates of the bond during any taxable year, there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to the sum of the credits determined under subsection
(b)with respect to such dates. The amount of the credit determined under this subsection with respect to any interest payment date for a clean energy bond is 28 percent of the amount of interest payable by the issuer with respect to such date. The credit allowed under subsection
(a)for any taxable year shall not exceed the excess of— the sum of the regular tax liability (as defined in section 26(b)) plus the tax imposed by section 55, over the sum of the credits allowable under this part (other than subpart C and this subpart). If the credit allowable under subsection
(a)exceeds the limitation imposed by paragraph
(1)for such taxable year, such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection
(a)for such taxable year (determined before the application of paragraph
(1)for such succeeding taxable year). For purposes of this section, the term clean energy bond means any bond issued as part of an issue if— 100 percent of the excess of the available project proceeds (as defined in section 54A(e)(4)) of such issue over the amounts in a reasonably required reserve (within the meaning of section 150(a)(3)) with respect to such issue are to be used for capital expenditures incurred by an entity described in subparagraph
(B)for 1 or more qualified facilities, the bond is issued by— a governmental body (as defined in paragraph
(3)of section 54C(d)), a public power provider (as defined in paragraph
(2)of such section), or a cooperative electric company (as defined in paragraph
(4)of such section), and the issuer makes an irrevocable election to have this section apply. For purposes of applying paragraph (1)— for purposes of section 149(b), a clean energy bond shall not be treated as federally guaranteed by reason of the credit allowed under subsection
(a)or section 6433, for purposes of section 148, the yield on a clean energy bond shall be determined without regard to the credit allowed under subsection (a), and a bond shall not be treated as a clean energy bond if the issue price has more than a de minimis amount (determined under rules similar to the rules of section 1273(a)(3)) of premium over the stated principal amount of the bond. The term qualified facility means a facility— which is described in subsection (e)(3) of section 45S and has a greenhouse gas emissions rate of less than 186 grams of CO 2 e per KWh (as such terms are defined in subsections (b)(1) and (e)(1) of such section), or which is described in subsection (e)(4) of section 45T and only produces transportation fuel which has an emissions rate of less than 38.62 kilograms of CO 2 e per mmBTU (as such terms are defined in subsections
(b)and
(e)of such section). For purposes of this section, the term interest payment date means any date on which the holder of record of the clean energy bond is entitled to a payment of interest under such bond. Subject to subparagraph (B), in the case of a clean energy bond for which the proceeds are used for capital expenditures incurred by an entity for a qualified facility described in subsection (d)(3)(A), if the Secretary, in consultation with the Secretary of Energy and the Administrator of the Environmental Protection Agency, determines that the annual greenhouse gas emissions from electrical production in the United States are equal to or less than the percentage specified in section 45S(d)(1), the amount of the credit determined under subsection
(b)with respect to any clean energy bond issued during a calendar year described in paragraph
(3)shall be equal to the product of— the amount determined under subsection
(b)without regard to this subsection, multiplied by the phase-out percentage under paragraph (3). If the Secretary, in consultation with the Secretary of Energy and the Administrator of the Environmental Protection Agency, determines that the annual greenhouse gas emissions from electrical production in the United States for each year before calendar year 2026 are greater than the percentage specified in section 45S(d)(1), then the determination described in subparagraph
(A)shall be deemed to have been made for calendar year 2025. Subject to subparagraph (B), in the case of a clean energy bond for which the proceeds are used for capital expenditures incurred by an entity for a qualified facility described in subsection (d)(3)(B), if the Secretary, in consultation with the Secretary of Energy and the Administrator of the Environmental Protection Agency, determines that the annual greenhouse gas emissions from transportation fuel produced and sold at retail annually in the United States are equal to or less than the percentage specified in section 45T(d)(1), the amount of the credit determined under subsection
(b)with respect to any clean energy bond issued during a calendar year described in paragraph
(3)shall be equal to the product of— the amount determined under subsection
(b)without regard to this subsection, multiplied by the phase-out percentage under paragraph (3). If the Secretary, in consultation with the Secretary of Energy and the Administrator of the Environmental Protection Agency, determines that the annual greenhouse gas emissions from transportation fuel produced and sold at retail annually in the United States for each year before calendar year 2026 are greater than the percentage specified in section 45T(d)(1), then the determination described in subparagraph
(A)shall be deemed to have been made for calendar year 2025. The phase-out percentage under this paragraph is equal to— for any bond issued during the first calendar year following the calendar year in which the determination described in paragraph (1)(A) or (2)(A) is made, 75 percent, for any bond issued during the second calendar year following such determination year, 50 percent, for any bond issued during the third calendar year following such determination year, 25 percent, and for any bond issued during any calendar year subsequent to the year described in subparagraph (C), 0 percent. For purposes of this title, interest on any clean energy bond shall be includible in gross income. Rules similar to the rules of subsections (f), (g), (h), and
(i)of section 54A shall apply for purposes of the credit allowed under subsection (a). The Secretary may prescribe such regulations and other guidance as may be necessary or appropriate to carry out this section and section 6433. . Subchapter B of chapter 65 of subtitle F is amended by adding at the end the following new section: The issuer of a qualified clean energy bond shall be allowed a credit with respect to each interest payment under such bond which shall be payable by the Secretary as provided in subsection (b). The Secretary shall pay (contemporaneously with each interest payment date under such bond) to the issuer of such bond (or to any person who makes such interest payments on behalf of the issuer) 28 percent of the interest payable under such bond on such date. For purposes of this subsection, the term interest payment date means each date on which interest is payable by the issuer under the terms of the bond. For purposes of section 148, the yield on a qualified clean energy bond shall be reduced by the credit allowed under this section. For purposes of this section, the term qualified clean energy bond means a clean energy bond (as defined in section 54BB(d)) issued as part of an issue if the issuer, in lieu of any credit allowed under section 54BB(a) with respect to such bond, makes an irrevocable election to have this section apply. . The table of sections for subpart J of part IV of subchapter A of chapter 1 is amended by adding at the end the following new item: Sec. 54BB. Clean energy bonds. . The heading of such subpart (and the item relating to such subpart in the table of subparts for part IV of subchapter A of chapter 1) are each amended by striking and inserting Build America Bonds . Build America Bonds and Clean Energy Bonds The table of sections for subchapter B of chapter 65 of subtitle F is amended by adding at the end the following new item: Sec. 6433. Credit for qualified clean energy bonds allowed to issuer. . Subparagraph
(A)of section 6211(b)(4) is amended by striking and 6431 and inserting 6431, and 6433 . The amendments made by this section shall apply to obligations issued after the date of the enactment of this Act.