Energy Tax

Incentives
 FEBRUARY 2009

ENERGY TAX INCENTIVES

Business energy credit. Enhances the business energy credit by eliminating the cap on small wind property and repealing
the basis reduction requirement for subsidized energy financing. Effective for periods after December 31, 2008.

Energy-efficient improvements to existing homes. Enhances the tax credits for energy-efficient improvements to
existing homes by raising the credit percentage to 30% (with an aggregate $1,500 cap) for qualifying expenditures incurred in 2009
and 2010.

Residential energy efficient property. Removes the dollar limitations on tax credits for qualified solar water heating,
geothermal heat pump, and small wind energy property, while retaining the credit cap for qualified fuel cell property, effective for tax
years beginning after December 31, 2008.

Credit for investment in advanced energy projects. Establishes a new 30% tax credit for investment in qualifying
property for advanced energy projects. Examples include property: (1) which re-equips, expands, or establishes a manufacturing
facility for the production of (a) property designed to be used to produce energy from the sun, wind, geothermal deposits or other
renewable resources, (b) fuel cells, microturbines, or an energy storage system for use with electric or hybrid-electric motor vehicles,
(c) electric grids to support the transmission of intermittent sources of renewable energy, including storage of that energy, (d) prop-
erty designed to capture and sequester carbon dioxide emissions, (e) property designed to refine or blend renewable fuels other
than fossil fuels, to produce energy conservation technologies (f) new qualified plug-in electric drive motor vehicles, qualified plug-in
electric vehicles, or components which are designed specifically for use with those vehicles, including electric motors, generators,
and power control units, or (g) other advanced energy property designed to reduce greenhouse gas emissions as may be deter-
mined by IRS, and (2) any portion of the qualified investment of which is certified by IRS. Effective from the date of enactment.

Increased qualified alternative fuel vehicle (QAFV) refueling property. Enhances the tax credit for the cost
of installing QAFV refueling property (i.e., property used for the storage and/or dispensing of electricity or clean fuel at the point of
transfer to the vehicles fuel tank or cells). Does so by (1) increasing the credit rate to 50% for non-hydrogen refueling property, (2)
increasing the maximum annual credit to $50,000, (3) increasing the maximum credit for nondepreciable QAFV refueling property to
$2,000. Effective for years starting after December 31, 2008.