The Inflation Reduction Act is a sea change in U.S. climate policy. It stands as the largest one-time public investment in decarbonization in U.S. history and is already shaping large-scale investment planning for energy generation, storage, and transmission. The elective pay (formerly referred to as direct pay) provisions of the law allow tax exempt entities, such as public utilities and state and municipal governments to receive tax credits as direct transfers from the IRS.  These elective pay provisions create new opportunities for public outlays on energy generation while having no formal cap on how much the government will spend through 2032.

Elective pay funded programs can play a catalytic role in seeding new public-sector capacity for planning and investing in large-scale clean energy projects nationwide. It creates the opportunity for a reorganization in how clean energy is developed in America.

Center for Public Enterprise works with local, state and federal public agencies, officials, and advocacy organizations on program design and implementation to make use of these elective pay provisions in the IRA. For more information, get in touch with us.

Recent Reports

Recent Articles