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Himachal Regulator Allows DISCOM to Procure 550 MW Solar Power from SECI

Agri-Solar Solutions Provider GK Energy Files Papers for ₹5.01 Billion IPO


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					</table><p>Solar ingot and wafer manufacturing facilities and equipment in the U.S. will qualify for a 25% investment tax credit (ITC) under the final regulations for the Advanced Manufacturing Investment Credit, part of the CHIPS Act 2022 announced by the <a href="https://home.treasury.gov/services/taxes" target="_blank" rel="noopener">Department of Treasury</a> and Internal Revenue Service (<a href="https://www.irs.gov/" target="_blank" rel="noopener">IRS</a>).</p>
<p>Section 48D of the Internal Revenue Code provides a 25% tax credit on qualified investments in advanced manufacturing facilities. This credit is designed to encourage the domestic production of semiconductors, including the slicing, etching, and bonding of the semiconductor-grade polysilicon used in photovoltaic modules.</p>
<p>The credit applies to tangible depreciable property integral to an advanced manufacturing facility&#8217;s operation, placed in service after December 31, 2022, but excludes property whose construction begins after December 31, 2026. Taxpayers must not be foreign entities of concern and should avoid significant transactions that expand semiconductor manufacturing capacity in foreign countries of concern.</p>
<p>These regulations became effective retroactively from December 23, 2024.</p>
<p>Including solar ingots and wafers under this tax credit is expected to accelerate investments in domestic production capabilities for these components, addressing a significant gap in the U.S. domestic solar supply chain.</p>
<p>No ingot and wafer facilities are operational in the U.S., making this incentive crucial for fostering new developments.</p>
<p>A unique feature of these regulations is a 10-year recapture rule. If a taxpayer significantly expands semiconductor manufacturing capacity in a foreign country of concern within ten years of placing qualified property in service, they must pay back the credit.</p>
<p>This rule aims to prevent outsourcing critical manufacturing capabilities. The final regulations provide detailed definitions for key terms:</p>
<ul>
<li>Semiconductor: Defined as an integrated electronic device or system manufactured using silicon or silicon carbide materials.</li>
<li>Semiconductor Manufacturing: Includes processes like wafer production, fabrication, and packaging but excludes precursor material production like polysilicon.</li>
</ul>
<p>In June, the U.S. <a href="https://www.mercomindia.com/us-proposes-expanding-new-clean-electricity-production-tax-credits" target="_blank" rel="noopener">proposed</a> new incentives under the Inflation Reduction Act by offering tax credits for electricity produced with low or zero greenhouse gas emissions, aligning financial assistance with environmental objectives. The Treasury and IRS detailed the regulations in sections 45Y and 48E of the Internal Revenue Code.</p>
<p>Last December, the Treasury and IRS introduced a new Section 45X that <a href="https://www.mercomindia.com/us-guidance-45x-tax-credit" target="_blank" rel="noopener">provides</a> a credit for the production (within the U.S.) and sale of certain eligible components, including solar and wind energy components, inverters, qualifying battery components, and applicable critical minerals.</p>


Solar Ingot and Wafer Manufacturing in US Eligible for 25% Investment Tax Credit


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					</table><p>The U.S. has proposed new incentives under the Inflation Reduction Act (IRA) by offering tax credits for electricity produced with low or zero greenhouse gas emissions, aligning financial assistance with environmental objectives.</p>
<p>The U.S. <a href="https://home.treasury.gov/" target="_blank" rel="noopener">Department of the Treasury</a> and Internal Revenue Service (<a href="https://www.irs.gov/" target="_blank" rel="noopener">IRS</a>) detailed the regulations in sections 45Y and 48E of the Internal Revenue Code.</p>
<p>The current Production Tax Credit and Investment Tax Credit for projects starting before 2025 will be phased out and replaced by the Clean Electricity Production Credit and Clean Electricity Investment Credit for projects operational after December 31, 2024.</p>
<p>&#8220;The Clean Electricity Tax Credits provide certainty to the market and are poised to drive substantial further growth and lower utility bills over the long run,&#8221; said Treasury Secretary Janet Yellen.</p>
<p>Government estimates show the credits could reduce power sector emissions by up to 73% below 2022 levels by 2035 and save consumers on electricity costs.</p>
<p>The proposed rules identify technologies qualifying for the credits, including wind, solar, hydropower, marine and hydrokinetic, nuclear fission and fusion, geothermal, energy storage, and certain waste energy recovery projects.</p>
<p>Meanwhile, technologies that rely on combustion or gasification must undergo a lifecycle analysis to demonstrate net-zero emissions.</p>
<p>The regulations outline how to calculate credits, define qualified facilities, and specify increased credit amounts for facilities meeting prevailing wage and apprenticeship requirements. They specify that taxpayers must maintain thorough records, including third-party reports, verifying emissions.</p>
<p>The Treasury sought public comments on the proposal over 60 days before issuing final rules.</p>
<p>China recently took the U.S. to the World Trade Organization for <a href="https://www.mercomindia.com/china-us-wto-ira-subsidies" target="_blank" rel="noopener">consultations</a> regarding certain tax credits under IRA to promote the production of electric vehicles and renewable energy projects.</p>
<p>Last December, the Treasury and IRS introduced a new Section 45X that <a href="https://www.mercomindia.com/us-guidance-45x-tax-credit" target="_blank" rel="noopener">provides</a> a credit for the production (within the U.S.) and sale of certain eligible components, including solar and wind energy components, inverters, qualifying battery components, and applicable critical minerals.</p>


US Proposes Expanding New Clean Electricity Production Tax Credits


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					</table><p><a href="https://www.mercomindia.com/india-installs-387-mw-of-rooftop-solar-drop" target="_blank" rel="noopener"><strong>India added 387 MW of rooftop solar capacity in the second quarter (Q2) of 2023, down 20% from 485 MW in Q1.</strong></a> According to the newly released Q2 2023 Mercom India Rooftop Solar Market Report, rooftop installations dropped 0.5% year-over-year. Priya Sanjay, Managing Director of Mercom India, said, “The downward trajectory of costs began in the quarter, and to see the tangible impact of this shift will require time. Effects of the cost reduction are anticipated to manifest more prominently in the upcoming quarters.”</p>
<p><a href="https://www.mercomindia.com/municipal-corporation-bids-22-ev-charging-stations" target="_blank" rel="noopener"><strong>Pimpri Chinchwad Municipal Corporation has invited bids to set up 22 public electric vehicle charging stations at various locations under its jurisdiction.</strong></a> The project will be developed on a build, own, and operate basis. The successful bidder will have to take care of the operation and maintenance of the project for eight years. The last date to submit the bids online is September 14, 2023. Bids will be opened on September 18. The project’s estimated cost is ₹151.8 million (~$1.84 million).</p>
<p><a href="https://www.mercomindia.com/pavagada-solar-park-expand-capacity-3-gw-seeks-land" target="_blank" rel="noopener"><strong>The 2,050 MW Pavagada Solar Park in Karnataka is going in for expansion with a proposed capacity addition of 3,000 MW.</strong></a> As one of the first steps towards expanding the park, the Karnataka Solar Power Development Corporation has invited expressions of interest to acquire lands on lease from landholders in two villages in the Tumkur district to develop two solar projects with a cumulative capacity of 3,000 MW.</p>
<p><a href="https://www.mercomindia.com/us-releases-new-guidelines-under-inflation-reduction-act" target="_blank" rel="noopener"><strong>The U.S. Department of the Treasury and the Internal Revenue Service have proposed rules and guidelines under the Inflation Reduction Act to harmonize sustainable energy and employment</strong></a> opportunities and solidify commitment to the “Investing in America” agenda. In August 2022, when the Act was introduced, it proposed $369.75 billion in energy security and climate change programs over the next ten years.</p>
<p><a href="https://www.mercomindia.com/lowest-tariff-revealed-japans-69-mw-solar-auction" target="_blank" rel="noopener"><strong>Japan’s Organization for Cross-regional Coordination of Transmission Operators has concluded the 17th auction for 69.07 MW of grid-connected solar power projects</strong></a>, announcing 55 successful bidders. The total bid capacity in the auction was 110.89 MW. The lowest tariff revealed in the auction was ¥8.95 (~$0.061)/kWh, and the weighted average winning bid was ¥9.30 (~$0.063)/kWh. The highest bid price was ¥9.43 (~$0.065)/kWh.</p>


Daily News Wrap-Up: India Installs 387 MW of Rooftop Solar Capacity in Q2


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					</table><p>The <a href="https://home.treasury.gov/" target="_blank" rel="noopener">United States Treasury Department</a> will provide incentives to developers under the Inflation Reduction Act (IRA) for building clean energy projects and facilities in communities with a historical connection to energy production.</p>
<p>The developers would be entitled to up to a ten percentage point on top of the Investment Tax Credit and an increase of 10% for the Production Tax Credit.</p>
<p>The focus on coal communities is significant as they have been adversely impacted by the transition to clean energy. The Act seeks to ensure that these communities can participate in the growth of the clean energy economy and benefit from public investment in it.</p>
<p>To qualify, developers must locate projects in areas with historical energy connections, such as regions with closed coal mines or coal-fired power plants.</p>
<p>Additionally, areas with significant employment or local tax revenues from fossil fuels and higher-than-average unemployment are eligible. Properties contaminated by hazardous materials or other pollutants, known as brownfields, also qualify.</p>
<p>The announcement builds on the guidance issued in February for the Qualifying Advanced Energy Project Credit under Section 48C of the Internal Revenue Code, which sets aside at least $4 billion for investments in manufacturing in coal communities. Applications for the first round of funding for the 48C credit are planned to open by May 31, 2023.</p>
<p>The IRA’s energy community bonus and the Qualifying Advanced Energy Project Credit offer valuable incentives for investment and job creation in coal communities, providing developers with financial support to invest in clean energy projects.</p>
<p>These initiatives present a promising opportunity to promote the transition to clean energy while creating jobs in communities historically connected to energy production.</p>
<p>Treasury Secretary Janet L. Yellen said that coal communities have the knowledge and resources to lead in the growth of the clean energy economy, and additional public investment will catalyze this process.</p>
<p>The Interagency Working Group on Energy Communities has partnered with Treasury and the Internal Revenue Services (IRS) to provide a searchable mapping tool to identify areas eligible for the energy communities&#8217; bonus. This tool will help developers to identify eligible areas and take advantage of the incentives offered by the IRA.</p>
<p>The U.S. government has made $1 billion in grants <a href="https://www.mercomindia.com/us-1-billion-for-farmers-renewables" target="_blank" rel="noopener">available</a> to help agricultural producers and rural small businesses invest in renewable energy systems and improve energy efficiency through the Rural Energy for America Program. The USDA will hold quarterly competitions through September 30, 2024, to distribute the funds.</p>
<p>Since the passage of IRA in August 2022, clean energy companies in the United States have <a href="https://www.mercomindia.com/us-act-creates-over-100000-green-jobs-six-months" target="_blank" rel="noopener">announced</a> over 101,000 new green jobs in 31 states, with 90 new clean energy projects totaling $89.5 billion in investments. Most projects are in Arizona, Georgia, Michigan, Ohio, South Carolina, Tennessee, and Texas.</p>


US to Promote Clean Energy Projects in Traditionally Coal-Producing Areas

<p>In the wake of the coronavirus (COVID-19) outbreak, the Treasury Department and the Internal Revenue Service (<a href="https://www.irs.gov/" target="_blank" rel="noopener noreferrer">IRS</a>) of the United States of America, have announced tax relief for taxpayers who have installed renewable energy projects.</p>
<p>This relief would apply to renewable projects using sources such as solar, wind, biomass, geothermal, landfill gas, trash, and hydropower, fuel cells, microturbines, and combined heat and power systems.</p>
<p>In a press statement, the IRS said that the relief had been announced because COVID-19 has caused industry-wide delays in the supply chain for components needed to complete renewable energy projects that are otherwise eligible for the investment tax credit (ITC).</p>
<p>For some projects that began construction either in 2016 or 2017, an extra year to the already existing four-year continuity safe harbor has been provided to complete the construction work seamlessly.</p>
<p>As per the notice, the government has allowed some companies additional time to receive materials, which will help them to start the construction works.</p>
<p>It has also provided a 3.5-month safe harbor for services or property paid for by the taxpayer on or after September 16, 2019, and received by October 15, 2020.</p>
<p>According to the notice, “By extending the continuity safe harbor and providing a 3.5-month safe harbor, the guidance will provide flexibility for taxpayers to satisfy the beginning of construction requirements and limit the impact of COVID-19-related delays on the ability to claim tax credits.”</p>
<p>The top three solar markets in the world – China, U.S., and India, <a href="https://mercomindia.com/china-united-states-india-collectively-solar/" target="_blank" rel="noopener noreferrer">added</a> nearly 51 GW of solar capacity in 2019. This year, these three markets, along with the rest of the world, have been severely affected by the slowdown caused due to the ongoing coronavirus pandemic.</p>
<p>Recently, the International Energy Agency (<a href="https://www.iea.org/" target="_blank" rel="noopener noreferrer">IEA</a>) had <a href="https://mercomindia.com/share-of-solar-and-wind-rose/" target="_blank" rel="noopener noreferrer">released</a> a report that focused on global energy demand and decline in the first quarter of 2020. The report stated that in March 2020, the production facilities of wind energy supply chains, especially in India, Europe, and the U.S., were either closed or reduced their activities.</p>


The United States Announces Tax Relief for Renewable Installers

<p>The State Water Transport Department (<a href="https://www.swtd.kerala.gov.in/pages-en-IN/index.php" target="_blank" rel="noopener noreferrer">SWTD</a>), Government of Kerala, has floated a tender for the construction and supply of three solar boats.</p>
<p>The last date for the submission of bids is November 30, 2019.</p>
<p>The vessels will be designed and built as a GRP catamaran solar-powered passenger ferry with a passenger capacity of 75, intended for operation in Kerala under the inland rules.</p>
<p>The vessel must be registered with Directorate of Ports, Government of Kerala, and should adhere to the rules and regulations laid down by the Indian Register of Shipping (<a href="https://www.irclass.org/" target="_blank" rel="noopener noreferrer">IRS</a>) or any member of the International Association of Classification Societies (<a href="http://www.iacs.org.uk/" target="_blank" rel="noopener noreferrer">IACS</a>).</p>
<p>Interested bidders will have to submit a sum of ₹900,000 (~$12,750) as the earnest money deposit (EMD).</p>
<p>As far as the eligibility criteria are concerned, the bidder should have prior experience in building a similar capacity of GRP catamaran solar ferry boats under IACS, and experience credentials should be submitted along with the bid. The vessel should be built in a yard in Kerala and should be approved by the Kerala Port Department IRS &amp; Technical Committee. The warranty period for the entire vessel provided by the builder should not be less than one year.</p>
<p>The turnover of the interested entities should be not less than ₹30 million (~$400,000) for the last two years, and the supply of the vessels should be made within 12 months from the date of the purchase order.</p>
<p>According to the tender document, lightweight materials should be used for the construction of the boats, and weight control measures should be strictly followed during the construction of the vessel.</p>
<p>High-efficiency polycrystalline solar PV modules should be fixed on the coach for generating electric power from the sun. The total capacity of the solar PV modules should not be less than 20 kW, and a battery bank of approximately 80 kWh consisting of lithium-iron-phosphate type batteries should be provided as an energy storage medium to meet the energy deficiency in cloudy conditions. The batteries should be capable of being charged by the solar panels through the solar charge controller. Solar power generation and storage should be designed using IEC standards of equipment to ensure reliability and safety.</p>
<p>Earlier this year, the Kerala State Electronics Development Corporation (<a href="http://www.keltron.org/" target="_blank" rel="noopener noreferrer">KELTRON</a>) had <a href="https://mercomindia.com/kerala-tender-3-mw-solar-naval-station-kannur/" target="_blank" rel="noopener noreferrer">issued</a> tender to set up a 3 MW grid-connected solar project at Naval Station Ezhimala, located in Kannur district.</p>
<p><a href="https://mercomindia.com/mes-tenders-3-mw-solar-project-ezhimala-kerala/" target="_blank" rel="noopener noreferrer">In the past</a>, the Military Engineering Services had also announced a similar tender for a 3 MW solar project to be developed at Ezhimala in Kerala. The estimated cost of the project was ₹225 million (~$3.487 million).</p>
<p>Image credit: CSIRO [CC BY <a href="https://upload.wikimedia.org/wikipedia/commons/b/bb/CSIRO_ScienceImage_11261_Solar_panels_on_boat.jpg" target="_blank" rel="noopener noreferrer">3.0</a>]</p>


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