IRS Announces New Clean Renewable Energy Bonds Supplemental Allocations for Cooperative Electric Companies
WASHINGTON — The Internal Revenue Service announced the allocation of $190,795,445 in volume cap authority for 13 projects owned by cooperative electric companies eligible to be financed with tax credit bonds under the New Clean Renewable Energy Bonds (“New CREBs”) program. Allocation of national volume cap authority to issue New CREBs (“Volume Cap”) under section 54C of the Internal Revenue Code is valid for three years after the date of the letter issuing the allocation.
In IRS Announcement 2010-54 (the “Announcement”), dated September 1, 2010, the Service announced a supplemental allocation round to award $190,795,445 of unallocated Volume Cap to cooperative electric companies for authority to issue New CREBs for qualified projects. This unallocated Volume Cap was left over from the initial allocation of Volume Cap under Notice 2009-33. The deadline for a cooperative electric company to submit an application, as set forth in the Announcement, was November 1, 2010.
The IRS has completed the review of applications submitted in response to the Announcement for a supplemental allocation of available New CREBs financing to cooperative electric companies and has notified applicants of the results. New CREBs Volume Cap allocations were awarded on a “smallest-to-largest” project basis pursuant to the guidance set forth in Notice 2009-33.
In this supplemental allocation round, 16 cooperative electric company borrowers submitted applications totaling about $511,535,000 to finance 16 projects with an average project size of about $31,970,937. Thirteen electric cooperative company borrowers were awarded the $190,795,445 of available Volume Cap allocation for 13 projects in 8 states ranging from $250,000 to $55,000,000. Projects receiving a Volume Cap allocation award will finance various qualified purposes including wind, landfill gas, hydropower, solar, open-loop biomass, and geothermal facilities.
Notice 2009-33 solicited applications for, and provided guidance on, the allocation of $2.4 billion in Volume Cap for New CREBs. Up to one-third ($800 million) of the total Volume Cap was available for allocation to qualified projects owned by cooperative electric companies. The Service received 31 applications requesting a total of $609,204,555 in Volume Cap for projects to be owned by cooperative electric companies. Pursuant to Section 6 of Notice 2009-33, the Service allocated $609,204,555 of the available $800 million in Volume Cap to the 31 cooperative electric company applicants using the smallest-to-largest methodology. Unallocated Volume Cap for cooperative electric company applicants in the amount of $190,795,445 was left over from that initial round.