Advanced Energy Project Credit (Section 48C)
Internal Revenue Service
30% of qualified investment
30% credit for clean-energy manufacturing
A federal investment tax credit of 6% (or 30% with prevailing wage/apprenticeship compliance) for manufacturing facilities that produce clean energy equipment or that process, recycle, or refine critical minerals. Congress allocated $10 billion in total IRA credit authority across all rounds; Round 2 (2023–2024) received $6 billion across two tranches (Tranche 1: $4B announced Feb 2023; Tranche 2: $6B announced Jan 2025). The DOE reviews applications and issues tax credit certificates. Unlike §48E, §48C is a competitive allocation — not every qualifying project gets funded. No new funding rounds have been announced as of mid-2026.
- Funding type
- Tax Credit
- Level
- Federal
- Amount
- 6% base rate (without prevailing wage/apprenticeship) or 30% with prevailing wage and apprenticeship compliance. Applies to qualified investment in a qualifying advanced energy project facility. Total IRA allocation: $10 billion across all rounds ($4B Round 2 Tranche 1 + $6B Round 2 Tranche 2). Individual project credits are uncapped as a percentage but must match the DOE-allocated amount.
- Realistic amount
- Round 2 awards ranged from approximately $500,000 to $150 million in credit allocations. A $10M manufacturing facility i…
- Deadline
- No new funding rounds announced as of May 2026. Existing Round 2 certificate holders (allocations made 2023–2024) may still claim their credit. Monitor DOE for future round announcements.
- Status
- between-intakes
- States
- Nationwide
- Payment model
- tax offset
Who qualifies
- Qualifying projects: (1) Manufacturing or recycling of tangible property used in clean energy production — solar panels, wind turbines, geothermal systems, fuel cells, batteries, EV charging equipment, smart grid equipment, EPA-listed advanced carbon capture equipment; (2) Production of critical minerals listed by USGS; (3) Industrial facilities that substantially reduce greenhouse gas emissions
- Property must be located in the United States
- Must receive a DOE tax credit certificate from a competitive allocation round before claiming the credit — entitlement credit without a certificate does not apply
- Full 30% rate requires prevailing wage and apprenticeship compliance for all construction/installation workers
- 6% base rate applies if prevailing wage requirements not met
- Eligible applicants: corporations, partnerships, S-corps, and other for-profit entities; nonprofits NOT eligible (no elective pay provision for §48C)
- Facilities previously receiving §48C Round 1 credits may apply again for Round 2 credits for additional investment
- The DOE evaluates applications on: technical merit, commercial viability, domestic job creation, greenhouse gas reduction, supply chain security, and whether the location is an energy community
Hard requirements
- Must be incorporated
What it covers
Eligible expenses
- Manufacturing equipment and machinery for producing qualifying clean energy property
- Facility construction costs (buildings, infrastructure) capitalized into the qualifying investment
- Critical mineral processing and refining equipment
- Advanced carbon capture and sequestration technology equipment
- Battery and energy storage manufacturing equipment
- Engineering and design costs capitalized into project basis
Ineligible expenses
- Non-manufacturing activities (installation, distribution, service of clean energy products — those qualify under §48/§48E as the end user)
- Fossil fuel production or processing equipment
- Facilities located outside the United States
- Soft costs not capitalized into property basis (permit fees, legal, administrative overhead)
- Investments at facilities previously awarded Round 2 credits unless new additional investment is made
How to apply
-
1
Monitor DOE for new round announcements
No new funding rounds have been announced as of mid-2026. Subscribe to DOE LPO/IRA updates at energy.gov/lpo/48c. If a Round 3 is announced, the application window typically opens within 60–90 days of announcement.
~1 hrs
-
2
Submit concept paper to DOE (when a new round opens)
DOE uses a two-stage process: (1) concept paper review (~5 pages, project overview, technology, investment amount, jobs created, GHG reduction); (2) full application invitation for encouraged applicants. Discouraged concept paper applicants may still submit a full application but face lower odds. The concept paper is a soft filter, not a binding decision.
~20 hrs
-
3
Prepare and submit full application
Full applications require: detailed engineering plans, financial model, site plan, supply chain analysis, prevailing wage compliance plan, workforce development commitments, and GHG lifecycle analysis. Applications are scored by DOE technical reviewers. IRS issues final credit certificates to DOE-recommended applicants.
~80 hrs
-
4
Place property in service within 2-year window
Upon receiving a DOE credit certificate, the taxpayer has 2 years to place the qualifying property in service. Construction delay beyond 2 years forfeits the certificate (though DOE may grant extensions). Prevailing wage compliance must be maintained throughout construction.
~4 hrs
-
5
Claim credit on Form 3468 with certificate
File IRS Form 3468 (Investment Credit) in the year property is placed in service. Attach DOE certificate documentation. Credit reduces income tax liability; excess carries back 1 year and forward 20 years. Basis reduction applies.
~6 hrs
Round 2 awards strongly favored energy community locations — 40% of Tranche 1 awards went to coal-closure communities. If your facility qualifies, energy community siting is your most powerful scoring lever.
Deadline & timing
Round 1 (2009–2012): $2.3B under original §48C, fully allocated. Round 2 (IRA 2022): $10B total authority, allocated via two competitive tranches — Tranche 1 ($4B, announced Feb 2023) and Tranche 2 ($6B, announced May 2024). No Round 3 announced as of May 2026. Existing certificate holders have 2 years from allocation date to place property in service and claim the credit. Companies awarded in Tranche 2 (2024) typically have until mid-2026 to place property in service.
Programs that stack well
Related programs
Last reviewed 2026. GrantCompass is an independent funding-discovery tool and is not affiliated with any government agency. Always confirm details on the official program page.