Qualifying additive generation project credit

(a) In general Subpart E of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 48F the following: 48G. Qualifying additive generation project credit (a) In general For purposes of section 46, the qualifying additive generation project credit for any taxable year is an amount equal to 30 percent of the qualified additive investment, as determined under subsection (b), for such taxable year. (b) Qualified additive investment For purposes of this section, the term qualified additive investment means the portion of the qualified investment in qualified property placed in service during the taxable year that is properly allocable to creditable excess capacity. (c) Creditable excess capacity For purposes of this section, the term creditable excess capacity means the portion of new or incremental electric generation capacity that— (1) exceeds the projected peak electric demand of a covered large-load facility; (2) is made available to one or more eligible load-serving entities pursuant to a long-term contract or other binding written agreement; and (3) does not exceed 50 percent of the projected peak electric demand of such covered large-load facility. (d) Qualifying additive generation project For purposes of this section, the term qualifying additive generation project means a project that— (1) develops, constructs, acquires, finances, or contractually dedicates new or incremental electric generation resources to support a covered large-load facility; (2) makes creditable excess capacity available to one or more eligible load-serving entities; and (3) does not shift generation, transmission, distribution, interconnection, stranded, or other infrastructure costs attributable to the covered large-load facility to existing residential, agricultural, small business, or other existing customers. (e) Verification and recapture (1) Verification No credit shall be allowed under this section unless the taxpayer certifies, in such form and manner as the Secretary may require, that— (A) the projected peak electric demand of the covered large-load facility is supported by an engineering study, utility service agreement, interconnection study, or other documentation determined appropriate by the Secretary, in consultation with the Secretary of Energy; (B) the creditable excess capacity is subject to a long-term contract or other binding written agreement with one or more eligible load-serving entities; and (C) such creditable excess capacity is reasonably expected to be deliverable to such eligible load-serving entities. (2) Recapture The Secretary shall provide rules for the recapture of all or a portion of any credit allowed under this section if, during such period as the Secretary determines appropriate— (A) the taxpayer materially increases the electric demand of the covered large-load facility in a manner that reduces or eliminates the creditable excess capacity; (B) the taxpayer terminates or materially reduces the long-term contract or other binding written agreement described in paragraph (1)(B); or (C) the Secretary determines that the projected peak electric demand of the covered large-load facility was materially understated. (f) Definitions For purposes of this section— (1) Covered large-load facility The term covered large-load facility means one or more nonresidential facilities behind a single point of interconnection that have, in the aggregate, a peak electric demand of 100 megawatts or more at a single site or campus. (2) Eligible load-serving entity The term eligible load-serving entity means an electric utility, public power utility, electric cooperative, municipal utility, investor-owned utility, Federal power marketing administration customer or preference customer, or any other load-serving entity determined appropriate by the Secretary. (3) Long-term contract The term long-term contract means a contract, tariff, service agreement, power purchase agreement, capacity agreement, or other binding written arrangement with a term of not less than 10 years. (4) Qualified property The term qualified property means tangible property that is used as an integral part of a qualifying additive generation project, with respect to which depreciation or amortization is allowable, and the original use of which begins with the taxpayer. (g) Guidance The Secretary, in consultation with the Secretary of Energy and the Federal Energy Regulatory Commission, shall issue such guidance as may be necessary to carry out this section, including guidance for determining qualified additive investment, projected peak electric demand, creditable excess capacity, deliverability, and prevention of cost shifting. (h) Termination This section shall not apply to any qualifying additive generation project placed in service more than 10 years after the date of enactment of this section.. (b) Part of investment credit Section 46 of the Internal Revenue Code of 1986 is amended by adding at the end the following: (8) the qualifying additive generation project credit.. (c) Clerical amendment The table of sections for subpart E of part IV of subchapter A of chapter 1 of such Code is amended by inserting after the item relating to section 48F the following: Sec. 48G. Qualifying additive generation project credit.. (d) Effective date The amendments made by this section shall apply to qualifying additive generation projects the construction of which begins after the date of enactment of this Act.