11/25/2009

Buy American Made Products, Just Another Reason

End Fossil the Pollution from Fossil Fuels
t

Sign the letter to protect the environment.
 
President Obama and Congress are working to address the global climate crisis and improve our environment. But now big corporations that moved to China where environmental regulations are weak are pressuring Congress and the Administration to drop the "Buy American" provision in the Recovery Act.
This would allow tax-payer dollars to support non-American workers in
countries with inferior pollution standards. 

Click here to send a letter to Congress
Let's make a difference in the
world we leave our children.
 
The typical Chinese foundries producing the same parts produce 20 times
more particulates and nearly 35 times more carbon monoxide than
foundries in the US. In fact, China is now the largest source
of both sulfur dioxide (SO2) and carbon dioxide (CO2) in the world.

You can help the environment and save American jobs by clicking here.

Thank you,
OurJobsOurEnvironment Coalition


Sign the letter to protect the environment
End Pollution from Burning Fossil Fuels by Switching to Renewable Energy Producing Systems.  True Renewable Energy has no Exhaust or Harmful Waste

11/21/2009

Home Owner Grant Info

US Dept of Treasury,Payments for Specified Renewable Energy Property in Lieu of Tax Credits

Dear US Treasury Dept,

I applaud the your Department on "Renewable Energy Resources"! Together we can make a difference in Reducing Energy Needs to Reduce Climate Change!!

I request the steps needed to obtain the above Payments for a Passive Solar Hot Water Heating System for Laundry Matts/Apartment Buildings.

Thank you for any time and consideration in assisting me with this effort.

Sincerely,
Scotty

1603Questions@do.treas.gov

 to me




Scotty--  Thank you for your email message.  You can find full information about the Section 1603 program at www.treas.gov/recovery/1603.shtml.

Scott's Contracting

 to 1603Questions

USDep of Treasury,
Is the process for applying/receiving federal aid for Home Owners the same as the links you provided in my prior email?

Thank you for any and all assistance and clarifications.

Scotty

1603Questions@do.treas.gov

 to me




Scotty--  No, the Section 1603 program is not for homeowners.  For information on other programs that support renewable energy initiatives, please see www.dsireusa.org.


**** The response contained in this email is for informational purposes only.  It does not necessarily represent the final views of the US Department of Treasury or the Section 1603 program and is therefore not binding. ****

PV durability and reliability issues





PV durability and reliability issues

ALLEN ZIELNIK, Atlas Material Testing Technology LLC, Chicago, IL USA

While no abbreviated test program can predict with 100% certainty that a module will properly perform in an environment for 25+ years, an improved methodology that more closely simulates the real environment, while still maintaining reasonable acceleration, can certainly be a valuable tool to assess the question of survivability.


The photovoltaic industry needs PV modules that will perform for ~25 years or longer in the field, as well as a reliable means to determine that viability. These are necessary not only for product development and warranty considerations, but also in terms of risk to financial stakeholders and overall economic viability—not to mention key safety concerns.
 

While there are initial PV qualification tests, such as the IEC and UL requirements, among others, they are neither intended to, nor capable of, predicting long-term performance. As a result, there has been an evolution in the application of accelerated life testing (ALT) and accelerated environmental testing (AET) to the service life prediction (SLP) of PV modules and systems.

25 years and beyond

To understand reliability, we must first define what we mean. For simplicity, we will say a PV module fails to provide service if its power output decreases by more than 20% after 30 years in its use environment. Also, “a high probability” means that 95% of the modules in the field will achieve this success [1],” or the like.

For most PV products, there are many additional concerns regarding what constitutes failure or unacceptable performance. Notably, safety after aging is a critical concern to protect life and property. There may also be critical aesthetic concerns, such as with BIPV products, which affect the viability (but not necessarily the power generation) of the product. If a module discolors in the Mojave Desert, no one may care, but if it discolors on a building fa├žade, everyone may care (at least one BIPV producer is out of business due to cosmetic failure).
 

At the Department of Energy “Accelerated Aging Testing and Reliability in Photovoltaics Workshop II” held in 2008, Akira Terao [2] (Sunpower Corp.) pointed out that, even in the mature c-Si module arena, there are still many remaining reliability challenges, including:

  • 25-year warranty. This is still a barrier; how does a company prove 25-year life?
  • Ill-defined field conditions. The same warranty must apply for all conditions for the same modules.
  • Harsh and varied outdoor conditions.
  • Materials used near their limits; how to accelerate the effects on material already being used near its limit.
  • Limited acceleration factors. There are few available; industry must rely on long tests instead. Long test time can be a hindrance to market introduction.
  • Cumulative effects, positive feedback loops. Challenging to determine and test for all interactions in the field.
The best approaches to reliability engineering include using the standard Weibull bathtub curve to determine the physics of failure for each mode.
According to John Wohlgemuth (BP Solar), “Today, BP Solar offers a 25-year warranty on most of its crystalline silicon PV modules…while the modules have to last for 25 years of outdoor exposure, we cannot wait 25 years to see how they perform… no BP/Solarex module has been in the field longer than ten years. Even the oldest 20-year warranty modules have only been in the field 15 years.”


Wohlgemuth adds, “Examples of accelerated stress tests of use for PV include:

  • Thermal cycling;
  • Humidity-freeze;
  • Damp heat;
  • Mechanical load both static and dynamic, and
  • Ultraviolet exposure [3].”
Failure Rate vs Lifetime

Reliability concerns associated with PV technologies

Quoting directly from a monograph [4] by Dr. Sarah Kurtz of NREL:
“General reliability issues across all PV technologies are:
  1. Corrosion leading to a loss of grounding
  2. Quick connector reliability
  3. Improper insulation leading to loss of grounding
  4. Delamination
  5. Glass fracture
  6. Bypass diode failure
  7. Inverter reliability
  8. Moisture ingress
Continuing, Dr. Kurtz said: “In addition, there are issues specific to the individual technologies, to name a few:


i. Wafer silicon: Light-induced cell degradation, front surface soiling, effect of glass on encapsulation performance, reduced adhesion leading to corrosion and/or delamination, busbar adhesion degradation, junction box failure;


ii. Thin film silicon: electrochemical corrosion of SnO2, initial light degradation;


iii. CdTe: interlayer adhesion and delamination, electrochemical corrosion of SnO2:F, shunt hot spots at scribe lines before and after stress;
iv. CIS: interlayer adhesion, busbar mechanical adhesion and electrical, notable sensitivity of TCO to moisture, moisture ingress failure of package; and v. OPV: photolytic instability, moisture induced degradation, moisture ingress failure of package.”
 

We often hear that people interpret passing the IEC 61215 or 61646 qualification tests is proof that a product has been tested and shown to be durable and reliable. This is simply not true; like many ALT tests, the IEC environmental stress test protocols are designed primarily to test the infant mortality period of the above-referenced bathtub curve (Fig. 1) and do not adequately or realistically stress a module in the way that nature does.
During life, a product loses performance attributes according to the accumulated damage model. Continued damage (thermal, photolytic, mechanical, hydrolytic, etc.) inflicted over a long time—and influenced by the daily and seasonal diurnal cycles—takes a toll.


According to Wohlgemuth, “While qualification tests are important, they have limitations because the stress levels are, by design, limited… so, passing the qualification test means that the product has met a specific set of requirements, but doesn’t say anything about which product is better for long-term performance, nor does it provide a prediction of product lifetime [3].”

Reliability vs. durability

Classic reliability testing is primarily concerned with measuring outright failure, such as time to failure, mean time between failures, number of failures per “n” units or operations, etc. A variety of accelerated life test methodologies (ALT, highly accelerated life testing [HALT], highly accelerated stress screening [HASS], etc.) are used in this pursuit.
 

The general methodology is to apply higher (sometimes considerably so) levels of stress than actual use conditions—but over a shorter period of time—to try to predict longer term performance. This methodology carries the caveat that it may induce failures that would not naturally occur, but can be very useful for studying failure modes and product robustness.
 

Another ALT approach is to use near-normal stresses but applied over a much shorter time period (such as cycling of a door hinge). The IEC tests predominantly use the first approach; for example, the 85°C/85%RH damp heat test condition is not very realistic in terms of actual service. These ALT approaches work best for mechanically-related single-stress failures, and response is often non-linear for chemically induced changes or where degradation is dependent on sequential or overlapping mechanisms.
 

Durability testing, however, is primarily concerned with realistically stressing products to predict long-term performance and is concerned with routes to failure (mechanisms), rates of performance, or property loss, etc. A loss of material or product durability may lead to catastrophic failure (i.e, loss of reliability). Another critical aspect of “durability to the environment” testing is that weather and climate have multiple inter-related stressors varying continuously in both short- and long-term patterns—something extremely difficult to reproduce in basic test equipment.
What is usually referred to in photovoltaics as “reliability,” such as no more than 1% power loss per year to a maximum of 20%, is actually a durability issue.

A sequenced approach

Many other industries, such as automotive and building products, have long learned and developed a general testing approach to weather durability testing. While lifetime expectations or product complexity may be less than that for PV, the needs are the same.
The progession is:
  • Material-level tests to select suitable products;
  • Component-level tests to include processing variables and some material-material interactions; and
  • Product-level tests to test final design and manufacturing, including transportation and installation.
To assess PV module durability, we usually start with the design failure modes and effects analysis (FMEA; or FMECA—failure modes, effects, and criticality analysis), and add a materials-level analysis. This helps to understand unique potential failure modes as well as potential test bias, both for optimizing the test methodology and for interpreting test results.
Next, materials-level tests are undertaken, especially for any polymeric materials (such as connectors, encapsulants, or topsheets) to determine their durabilities. We progress to component-level or pre-production unit testing, if warranted. Such testing can be helpful in determining processing variables, such as laminating conditions, or detecting basic problems, such as edge sealing or adhesion issues. The next step is full-module (or product, such as BIPV) testing.

An improved testing regimen

The primary module durability testing to date has simply relied on extending the existing IEC qualification tests to longer duration (e.g., more hours or more cycles). From our perspective, involving extensive work with PV materials and module manufacturers (as well as other industries) over the past years, and with millions of various products and materials on exposure in labs and test sites around the world, this approach has several flaws.


Although to study or force failure modes can have value for ALT testing, it isn’t a realistic approach for estimating long-term weather durability. It limits the number of simultaneous stresses (such as temperature cycling without humidity or solar radiation), uses stress levels not representative of specific end-use climates, and fails to deliver the stresses in the complex short- and long-term cycles of the natural environment. In weathering testing, the rule is: do a different test (than nature), get a different result.


To improve weather test modules to predict the likelihood of 25+ years durability, Atlas has been developing an improved test methodology. The fundamental characteristics are:

  • Parameters are selected based on three major PV use climatic zones: arid desert, tropical/subtropical, and northern/temperate, plus one additional global composite of all three sets of boundary conditions.
  • Additional test modifiers of urban/industrial (e.g., hydrocarbons, soot); windblown dust/dirt; acid rain; mechanical loading; and coastal/marine.
  • Combining multiple stresses into single test cycle modules, such as combined temperature and humidity cycling and humidity freeze with solar radiation to better simulate the natural environment.
  • A series of test sequences, combining corrosion, condensing humidity, thermal/humidity/freeze/solar, outdoor solar tracking, UV preconditioning, etc.—all performed on the same module.
  • Periodic visual inspections, I-V curve measurements, and thermal imaging.
Utilizing a variety of accelerated environmental testing (AET) devices and techniques, at realistic climate-specific stress levels and delivered in cycles that mimic the natural environment, this methodology can be run prior to, concurrent with, or following the IEC qualification tests, and is available now.

Conclusion

Service life prediction of complex products is an evolving discipline that often requires data and techniques that are not available. But while this methodology does not purport to address true SLP, it does have a 95-year foundation in empiricism shown to provide practical results. While no test program can predict with 100% certainty that a module will properly perform in an environment for 25+ years (except for real-time 25 year testing, of course), an improved methodology that more closely simulates the real environment while still maintaining reasonable acceleration can certainly be a valuable tool to answer the question, “Will my module last 25+ years?”

References

1. T. McMahon, G. Jorgensen, R. Hulstrom, “Module 30 Year Life: What Does it Mean and Is It Predictable/Achievable?,” National Renewable Energy Laboratory, Reliability Physics Symposium, 2008 (IRPS 2008); IEEE Inter., April 27, 2008-May 1, 2008 pp.: 172–177.
2. U.S. Department of Energy, Accelerated Aging Testing and Reliability in Photovoltaics Workshop II, Summary Report, April 1 & 2, 2008.
3. J. Wohlgemuth, “Reliability of PV Systems, Reliability of Photovoltaic Cells, Modules, Components and Systems,” edited by Neelkanth G. Dhere, Proc. of SPIE ,Vol. 7048, 704802-1, (2008).
4. S.Kurtz, “Reliability concerns associated with PV technologies,” www.nrel.gov/pv/performance_reliability/pdfs/failure_references.pdf
Allen Zielnik received his associates degree in electronics engineering from DeVry U. and BS in chemistry from Michigan State U., and is a senior consultant within the Solar Energy Competence Center of Atlas Material Testing Technology, 4114 North Ravenswood Ave., Chicago, IL 60613 USA; 773-327-4520; info@atlas-mts.com

11/20/2009

St Louis Renewable Energy Web Site is being upgraded, sorry for any inconvenience. Scotty

St Louis Renewable Energy Web Site is being upgraded, sorry for any inconvenience. Scotty

Blog is being UP Dated

Blog is being UP Dated Please Follow this Link:

News-Auto Fule Effeciency

Dear Scotty, For the past 20 years, the fuel efficiency standards for cars and trucks sold in the U.S. have barely changed. Right now, we're on the verge of a huge breakthrough on fuel efficiency -- and we need your help to make sure it succeeds. The Environmental Protection Agency has proposed new standards that will improve the gas mileage of new cars and light trucks. These standards will: * Reduce our oil consumption by 1.8 billion barrels of oil; * Save Americans $190 billion on fuel costs -- $3,000 per vehicle purchased under the new standard; * Cut carbon dioxide emissions by 950 million metric tons. This historic step will finally move us toward energy independence and loosen Big Oil's grip on the American economy. But the special interests are going to do everything they can to block these critical reforms, so we need to let our leaders know that we support these efforts. Tell EPA Administrator Lisa Jackson: "I support efforts to strengthen fuel efficiency standards that will reduce pollution and revitalize our auto industry." In addition to helping protect American consumers and our climate, this proposal is also supported by major automobile manufacturing associations, and many automakers including Chrysler, Ford and GM. That's because the new standards simultaneously reduce our auto emissions and preserve automobile buying choices for American consumers. After years of inaction, improving mileage standards is an essential step toward energy independence and addressing the climate crisis. Tell the EPA you support strong fuel efficiency standards to Repower America: http://acp.climateprotect.org/epanov

11/17/2009

Billions in Lending Authority for Renewable Energy Projects

News Media Contact(s): (202) 586-4940 For Immediate Release July 29, 2009 Obama Administration Announces Billions in Lending Authority for Renewable Energy Projects and to Modernize the Grid Loan Guarantees Will Help Create New Jobs while Fostering Clean Energy Innovation Washington, DC – U.S. Energy Secretary Steven Chu announced today that the Department of Energy will provide up to $30 billion in loan guarantees, depending on the applications and market conditions, for renewable energy projects. Another $750 million will support several billion dollars more in loan guarantees for projects that increase the reliability, efficiency and security of the nation’s transmission system. The two new loan guarantee solicitations announced today are being funded partly through the Recovery Act and partly through 2009 appropriations. “These investments will be used to create jobs, spur the development of innovative clean energy technologies, and help ensure a smart, strong and secure grid that will deliver renewable power more effectively and reliably,” said Secretary Chu. “This administration has set a goal of doubling renewable electricity generation over the next three years. To achieve that goal, we need to accelerate renewable project development by ensuring access to capital for advanced technology projects. We also need a grid that can move clean energy from the places it can be produced to the places where it can be used and that can integrate variable sources of power, like wind and solar.” The lending authority includes:  Up to $8.5 billion in lending authority supported by 2009 annual appropriations for renewable energy.  Up to $2 billion in subsidy costs, provided by the Recovery Act, to support billions in loans for renewable energy and electric power transmission projects.  Up to $500 million in subsidy costs to support loans for cutting edge biofuel projects funded by the Recovery Act.  Up to $750 million in subsidy costs, provided by the Recovery Act, to support loans for large transmission infrastructure projects in the U.S. that use commercial technologies and begin construction by September 30, 2011. The two solicitations issued today mark the sixth and seventh rounds of solicitations by the Department’s Loan Guarantee Program, which encourages the commercial use of new or improved energy technologies to help foster clean energy projects. Applications will be accepted over the next 45 days. The Department has streamlined its processes to accelerate these new loan solicitations. By investing in both renewable energy technology for generating electricity and technologies to modernize the country's transmission system, the Recovery Act targets the full integration of renewable energy sources onto the electric grid. Read more information on this solicitation and the Department’s Loan Guarantee Program. Additional loan guarantee solicitations funded by the Recovery Act will be announced soon. U.S. Department of Energy, Office of Public Affairs, Washington, D.C.

How To Get Renewable Energy Grant Money from the U.S. Government

September 23, 2009 How To Get Renewable Energy Grant Money from the U.S. Government by J. Peter Lynch, Financial Anaylst How does one go about applying for the new government program that allows a solar, wind project or other specified energy property to receive a cash grant from the U.S. Treasury in lieu of a 30% tax credit? -- Michael W., Hartford, CT. Michael, I’m glad you asked. As someone who recently completed this process, I can tell that there are multiple steps but the process works. The entire application is online. First, you go to the United States Department of the Treasury's Application Submission Page for payments in lieu of tax credits for specified energy property. These payments are authorized by Section 1603 of The American Recovery and Reinvestment Act's tax title signed into law on February 17, 2009. Once you are on the site, you need to check out the guidance section by clicking the link under the first two paragraphs. For the guidance document, Terms and Conditions, and sample application form, go here.(Link Provided by Scotty:http://www.lgprogram.energy.gov) Here in the guidance section, you will find a complete example of a submission and all of the other material you will need to go ahead. It is especially important to make sure to then scroll to the bottom of the page to the Important Reminder section. Here you will need to apply for a CCR – a Central Contractor Registration. You must get a CCR number there before you will be allowed to proceed with your application. To apply, you’ll need your DUNS number, your Tax Identification Number (TIN) and various other pieces of information about your business. Once you have been assigned your CCR, you return to the original submission page, here. At this point you can pick a username and password from the submission page and proceed to fill in the submission document. You will need: * Complete details of the project, * Full accounting as to all expenses and * A number of other items, which are described in the document Bear in mind that there is a lot of requested information to fill in, but it is well worth it. If you take it one step at a time you will be fine. The Obama administration and the U.S. Treasury have, in my opinion, made the government proud. They actually came up with an excellent idea – Cash instead of tax credits – and implemented it quickly and ahead of schedule! In fact, they promise that after the application has been accepted as complete that they will review the document and pay the grant within 60 days. Sounds fast, doesn’t it? But I am here to tell you the good news. We applied for such a grant for our building, a 550-kW PV system at 60 Shelter Rock in Danbury CT on the first day that the government was accepting applications and we received our grant in the first round of grants via wire transfer in approximately 10 days from start to finish! I think that my project is a good real world example of the type of new ideas and leadership that the new administration is encouraging to help the renewable energy industry prosper and grow. If you have a renewable energy project and you’d like some help applying for a grant, feel free to contact me. Good luck! Mr. Lynch has worked, for 32 years as a Wall Street security analyst, an independent security analyst and private investor in small emerging technology companies. He has been actively involved in following developments in the renewable energy sector since 1977 and is regarded as an expert in this field. He was the contributing editor for 17 years to the Photovoltaic Insider Report, the leading publication in PV that was directed at industrial subscribers, such as major energy companies, utilities and governments around the world. He is currently a private investor and has from time to time been a financial/technology consultant to a number of companies. He can be reached via e-mail at: SOLARJPL@aol.com. Please visit his website for the promotion of solar energy – www.sunseries.net or his new solar powered building at www.60shelterrock.com

The Race for New Energy-Related Federal Cash Grants

The Race for New Energy-Related Federal Cash Grants by Gregory C. Burkart & Jerome M. Schwartzman Not even Franklin Delano Roosevelt could have imagined the scope and breadth of the current federal programs to stimulate the economy. Some of the new federal programs require standing in a different kind of line -- a line to obtain grants set aside for energy-related projects and, unlike the FDR programs, it appears to be the race goes to the swift. The U.S. Department of Treasury recently released its long-anticipated guidance on payments for specified energy property in lieu of tax credits (Section 1603 Grants). Since August 1, when the application became available online, this program has been a hit with the energy and investment communities. In the first 45 days of the program, the Treasury Department has issued checks totaling $1.05 billion on 40 projects. While the program does not expire until October 1, 2011, projects must generally be commenced during 2009 or 2010, and the projects must be placed in service by various dates, as further explained below. The Section 1603 Grant is received within 60 days of filing a completed application or placing the property in service, whichever is later. If you have current or potential projects that may benefit from these grants, you should review the application as well as consider the following information about the program. The Section 1603 grants under the American Recovery and Reinvestment Act of 2009 (ARRA) provides for cash grants equaling 30% of the basis of “specified energy property” (10% for certain property). For this purpose, “specified energy property” generally includes two broad categories of property, IRC Section 45 (renewable-based electricity production property) and Section 48 (qualifying alternative energy credit property). Expansions of existing Section 45 and 48 properties are also eligible for the grants. The government is offering cash grants rather than credits based on the “diminished investor demand for income tax credits” in the current economic climate. We note that the Section 1603 Grant is not subject to federal income tax (there is an exception for certain leases), but may be subject to state income/franchise or gross receipts tax. Instead, the basis of the “specified energy property” is reduced by an amount that is equal to 50% of the cash grant. To determine basis of the property, the guidance adopts the general rules of determining basis for federal income tax purposes. Generally, the basis is the cost of the property placed in service after 2008, “unreduced by any other adjustments to basis, such as that for depreciation, and includes all items properly included by the taxpayer in the depreciable basis.” To be eligible for the Section 1603 Grant, the specified energy property must be originally placed in service by the owner or lessee. “Specified property” is depreciable (or amortizable in lieu of depreciation) “tangible personal property” and other tangible property (excluding buildings) as defined in the Income Tax Regulations. The tangible personal property must be an integral part of the facility and must be located at the facility. “Placing the property in service” means that the specified energy property is ready and available for its specific use. Where a project contains used parts, the property still qualifies for “original use” if the cost of the used parts is not more than 20% of the total cost of the facility. There are four categories of persons who are not eligible for the Section 1603 Grant: 1. Any federal, state or local government 2. Any organization described in IRC Section 501(c) and exempt from tax under IRC Section 501(a) 3. A clean renewable energy bond dealer or a cooperative electric company 4. Any partnership or pass-thru entity, any direct or indirect partner of which is an organization or entity described in categories one to three above, unless the person only owns an indirect interest in the applicant through a blocker sub (e.g., a taxable C corporation). The property must be placed in service by a date known as the “Credit Termination Date,” which varies with the type of project. The applications are due, even for projects that have started construction in 2009 or 2010 but have not been placed in service during those years, by the statutory deadline of October 1, 2011. The Treasury Department promises payment of the Section 1603 Grant within 60 days of either placing the property in service or receiving a completed application, whichever is later. For those projects under construction, the Treasury Department proposes to review the application materials and notify the applicants whether the eligibility requirements, through the date of application, have been met. Once the applicant completes construction, the company has 90 days after placing the property in service to submit supplemental information to the Treasury Department for it to make a final determination on eligibility. For applications that require supplemental information, the Treasury Department will provide notification, and the applicant has 21 days to provide such information to the Treasury Department. Structuring Section 1603 Grant Investments The investment can be made through a partnership or limited liability company, but each partner/member must be eligible for the credit. However, an ineligible investor can invest through a taxable C corporation. While non-U.S. investors are generally not eligible, certain exceptions may apply. Though the grant is generally available to owners of property, it is also available to lessees in certain circumstances. For example, it is available to the lessee in a sale/leaseback transaction if three conditions are satisfied: 1. The lessee must be the person who originally placed the property in service; 2. The lessee must have sold and leased the property within three months after the date the property was originally placed in service; and 3. The lessee and the lessor must not make an election to preclude application of the “sale-leaseback” rules. If a Section 1603 Grant is received for property and the property is disposed of within five years of placing the property in service or the property no longer qualifies as “specified energy property,” the grant must be repaid to the Treasury Department on a declining, pro-rata basis over five years. That is, recapture is 100% in the first year, 80% in the second year and so forth. The Treasury Department has also issued guidance (Notice 2009-52) on electing an investment tax credit based on the cost of a facility (similar to those for solar and fuel cells) rather than based on the production of electricity. As noted by the government, cash grants may be a more attractive option these days than a tax credit. Gregory Burkart is a managing director in the Detroit office of independent financial advisory and investment banking firm Duff & Phelps. His 13 years of experience includes specialization in the structuring and negotiating of government-sponsored economic development incentive packages. Having previously served as former Michigan Governor Engler’s Environmental Ombudsman, Gregory is an expert on domestic and international site selection; economic incentives negotiation; decision analysis; and demonstrating development projects' economic and fiscal impact to state and local governments. Jerome Schwartzman is a managing director in the New York office of independent financial advisory and investment banking firm Duff & Phelps. Jerome has more than 18 years of experience as a tax specialist and attorney, primarily in the areas of mergers and acquisitions, transaction consulting and bankruptcy. He has vast expertise in tax issues related to domestic and international transactions and has served private equity funds, public and private companies and numerous investment banking firms. Jerry has also served as an expert witness in a number of litigation and arbitration matters. Next Post:[Editor’s note: To read about a project that went through the process and received funding, check out Peter Lynch’s Ask the Experts article: How to Get Renewable Energy Grant Money from the U.S. Government. ] Image Gallery (1)

11/15/2009

Green X-mas Tree, New York Style

No pang of guilt towards the environment this year in Rockefeller Center as the traditional Christmas tree will be lit with energy-saving bulbs throughout the holidays and then transformed into houses by Habitat for Humanity. The Rockefeller Center Christmas Tree in Manhattan, N. Y. attempts to inspire on more levels than one this year, not only with holiday cheer and goodwill, but also with peaceful thoughts (and actions) towards our environment. New York City Mayor Michael Bloomberg said Tuesday that he hopes the brightly lighted Manhattan trademark display will inspire New Yorkers and tourists alike to make “greener” choices themselves. “Now they will see an example of green leadership which may inspire them to make greener choices in their own lives,” Bloomberg said. The entire process of cutting, transporting, lighting and displaying the tree, as well as reusing it after the holiday season, is environmentally-conscious this year. The 84-foot-tall Norway spruce which is the 75th Tree was cut with a hand saw by two workers, the old-fashioned way, to honor “the heritage of the Tree process,” official website www.thetreenyc.com explains. The tree will be covered with 30,000 multicolored energy efficient light-emitting diodes, or LEDs, strung on five miles of wire. This will reduce the display's electricity consumption from 3,510 to 1,297 kilowatt hours per day, reports the Associated Press. The daily savings is equal to the amount of electricity consumed by a typical 2,000-square-foot house in a month, per the AP. There will also be a 365-panel solar energy array installed on the roof of 45 Rockefeller Plaza to create a 70Kwh generation station, which will remain in place after the holiday season. The official lighting of the tree will occur during a ceremony on Nov. 28; during the following weeks, the tree will be illuminated from 5:30 a.m. to 11:30 p.m. most days, through the first week of January. The tree will be taken down on January 8, only to serve a higher purpose, as Habitat For Humanity will use it to build symbolic doorframes that will be used in select HFH building programs in NYC, the Gulf Coast, India and Brazil. LED LIGHTING: Go Green - Save Energy & Money!

11/14/2009

Tankless Water Heaters, Save Energy & Water

Demand (Tankless or Instantaneous) Water Heaters Financial Benefits * Did you know that a tankless water heater can save you $400 to $700 over its lifetime? A tankless gas water heater saves an average of $400 over thirteen years as compared to a conventional gas storage heater, and an electric tankless water heater saves about $700 over thirteen years as compared to a conventional electric storage heater. * Did you know that you can rely on your tankless water heater for more than 20 years? While most conventional water heaters only last 10 to 15 years, most tankless water heaters will last more than 20 years, and their easily replaceable parts make repairs simple and durable. Environmental Benefits * Did you know that a tankless water heater could save your home up to 86 gallons of water per day? Homes that use a lot of hot water can increase energy efficiency by 8% to 14%, saving about 86 gallons of water per day. Homes with typical hot water usage, 41 gallons or less each day, can increase energy efficiency by 24% to 34% by installing a tankless water heater. Installing a tankless heater at every hot water outlet can result in energy savings of 27% to 50%! Note Added by Scotty, Scott's Contracting: Tankless water heaters need 2/3 less space- can be mounted in, Bath/Kitchen, Cabinets. email:scottscontracting@gmail.com for additional info. Installation Quotes free of charge Demand (tankless or instantaneous) water heaters provide hot water only as it is needed. They don't produce the standby energy losses associated with storage water heaters, which can save you money. Here you'll find basic information about how they work, whether a demand water heater might be right for your home, and what criteria to use when selecting the right model. Illustration of an electric demand water heater. At the top of the image, the heating unit is shown. Cold water flows in one end of a pipe, flows through and around several curved pipes over the heating elements, and out the other end as hot water. Beneath the heating unit, a typical sink setup is shown. The sink has two pipes coming out the bottom, one for the hot water line and one for the cold water line. Both pipes lead to the heating unit, which is installed in close proximity to the area of hot water use, and is connected to a power source (110 or 220 volts). How They Work Demand water heaters heat water directly without the use of a storage tank. Therefore, they avoid the standby heat losses associated with storage water heaters. When a hot water tap is turned on, cold water travels through a pipe into the unit. Either a gas burner or an electric element heats the water. As a result, demand water heaters deliver a constant supply of hot water. You don't need to wait for a storage tank to fill up with enough hot water. However, a demand water heater's output limits the flow rate. Typically, demand water heaters provide hot water at a rate of 2–5 gallons (7.6–15.2 liters) per minute. Gas-fired demand water heaters produce higher flow rates than electric ones. Sometimes, however, even the largest, gas-fired model cannot supply enough hot water for simultaneous, multiple uses in large households. For example, taking a shower and running the dishwasher at the same time can stretch a demand water heater to its limit. To overcome this problem, you can install two or more demand water heaters, connected in parallel for simultaneous demands of hot water. You can also install separate demand water heaters for appliances—such as a clothes washer or dishwater—that use a lot of hot water in your home. Other applications for demand water heaters include the following: * Remote bathrooms or hot tubs * Booster for appliances, such as dishwashers or clothes washers * Booster for a solar water heating system. Although gas-fired demand water heaters tend to have higher flow rates than electric ones, they can waste energy if they have a constantly burning pilot light. This can sometimes offset the elimination of standby energy losses when compared to a storage water heater. In a gas-fired storage water heater, the pilot light heats the water in the tank so the energy isn't wasted. The cost of operating a pilot light in a demand water heater varies from model to model. Ask the manufacturer how much gas the pilot light uses for the model you're considering. If you purchase a model that uses a standing pilot light, you can always turn it off when it's not in use to save energy. Also consider models that have an intermittent ignition device (IID) instead of a standing pilot light. This device resembles the spark ignition device on some gas kitchen ranges and ovens. For homes that use 41 gallons or less of hot water daily, demand water heaters can be 24%–34% more energy efficient than conventional storage tank water heaters. They can be 8%–14% more energy efficient for homes that use a lot of hot water—around 86 gallons per day. You can achieve even greater energy savings of 27%–50% if you install a demand water heater at each hot water outlet. Selecting a Demand Water Heater Demand water heaters cost more than conventional storage water heaters. However, you may find that a demand water heater may have lower operating and energy costs, which could offset its higher purchase price. Before buying a demand water heater, you also need to consider the following: * Size * Fuel type and availability. * Energy efficiency (energy factor) * Estimate costs. For information about specific demand water heater models, see the Product Information resources listed on the right side of this page (or below if you've printed out this page). Installation and Maintenance Proper installation and maintenance of your demand water heater can optimize its energy efficiency. Proper installation depends on many factors. These factors include fuel type, climate, local building code requirements, and safety issues, especially concerning the combustion of gas-fired water heaters. Therefore, it's best to have a qualified plumbing and heating contractor install your demand water heater. Do the following when selecting a contractor: * Request cost estimates in writing * Ask for references * Check the company with your local Better Business Bureau * See if the company will obtain a local permit if necessary and understands local building codes, etc. If you're determined to install your water heater yourself, first consult the manufacturer. Manufacturers usually have the necessary installation and instruction manuals. Also, contact your city or town for information about obtaining a permit, if necessary, and about local water heater installation codes. Most tankless water heaters have a life expectancy of more than 20 years. They also have easily replaceable parts that extend their life by many more years. In contrast, storage water heaters last 10–15 years. Periodic water heater maintenance can significantly extend your water heater's life and minimize loss of efficiency. Read your owner's manual for specific maintenance recommendations.

11/13/2009

Andalay Solar Power " Details "

Designed for Maximum Reliability and Systematic Installation Solar systems must last decades in the harsh environment of your roof. To ensure these systems last, meticulous engineering design was applied to build the next generation in solar systems that eliminates exposure of weather sensitive components. Andalay is designed for primary assembly at our factory, not at your home like ordinary solar systems. The result is an integrated solar system that will provide decades of reliable solar power performance. With “Good Looks” to Match Andalay’s Meticulous Design In addition to Andalay providing a more reliable system that delivers decades of solar power performance, it also delivers a cleaner and more attractive look. With its slimmer panels, invisible electrical cabling and hidden mounting system, Andalay takes less room while blending into your roof like a skylight. A Whole New Look to Solar Power ST175-1 Andalay Mechanical Specifications - System Racking hardware Integrated External Grounding wires Integrated External Wiring connections Factory-assembled Installer-assembled Module-module connections Integrated External (Threaded) (Friction Clips) Space between modules 1/8” Up to 3” Roofing penetrations 25% Fewer Standard Scott's Contracting@gmail.com A whole new look to solar power © March

Andalay Solar Power, Specs

Andalay is an Integrated Solar Power System Built-in Reliability & Safety * No single point of system failure * Built-in electrical and ground connectors cannot loosen or be installed incorrectly * No dangerous 600 volt DC wiring * Shorter wire lengths are less likely to fail by pinching or abrading * 70% fewer roof-assembled parts means a longer lasting system * 25% fewer roof attachment points means greater roof integrity * Grounding process cannot skip panels, connectors will not wear or corrode High Performance * 5 - 25% better performance than ordinary DC panels * Built in microinverter delivers greater production in low light conditions on a per module basis * Latest generation monocrystalline cell technology * Output tolerance of just 3% means the promised power is delivered * Lighter weight and less space between panels so more can fit on a roof * Lower electrical resistance losses due to shorter wire lengths Convenience and Safety for Customer and Installer * Andalay modules are UL listed and CSA certified and meet National Electrical Code requirements * A lighter system that requires a single hand tool to install makes it safer for the installer * Microinverters are fully compliant with UL 1703 solar test and National Electric Code requirements Beautiful Design * No external racks or dangling wires for a clean, uncluttered look * No bulky inverters or unsightly wiring * No gaps between panels for a contiguous, smooth appearance * Panels and all hardware are flat black – they look like skylights! Long Warranty * 12/25 year power output Andalay module warranty provides confidence in purchasing today and protection in the future * 15 Year Standard Microinverter Warranty Environmentally Sensitive * No external cardboard packaging means less waste to dispose * Lighter weight and fewer parts means fewer resources required to produce and less fuel needed to transport

Solar Systems by Andalay

Andalay, the next generation in solar power systems, engineered away these flaws with its award-winning revolutionary design. Protected wiring, assembly in a quality-controlled factory environment, and superior framing, grounding and wiring deliver a system that is built to provide decades of reliable solar power performance. email: scottscontracting@gmail.com

11/11/2009

Energy Star Audit Sign UP

Energy Star Home Improvement Tips

EPA estimates that homeowners can typically save up to 20% of heating and cooling costs (or up to 10% of total energy costs) by air sealing their homes and adding insulation in attics, floors over crawl spaces, and accessible basement rim joists. This estimate is based on energy modeling (using REM/Rate version 11.0) of cost-effective improvements made to 'typical' existing U.S. homes with a weighted composite of characteristics. The modeled results are corroborated by the field experience of professional building science contractors who have done air sealing and insulation work for more than 20 years. Establishing a 'Typical' U.S. Existing House The Residential Energy Consumption Survey (RECS) indicates that a large block of existing U.S. housing stock was constructed between 1975 and 1985, just after the 1973 oil embargo, when there was a new increased awareness of energy use in homes. As a result, EPA based its modeling around the common construction characteristics of homes built in this era as a proxy for a 'typical' existing U.S. home. Construction characteristics for the 1975–85 era were determined based on a review of RECS data from the U.S. Department of Energy, 1997 EDS (Energy Data Sourcebook for the U.S. Residential Sector and earlier versions) data from Lawrence Berkeley National Laboratory, and other supporting data, including anecdotal experience of ENERGY STAR staff and stakeholders. Based on these sources, EPA assumed the following characteristics for a house from the 1975–85 era: * 1,500 square feet of conditioned floor area; * 14% window-to-floor-area ratio; * 20% duct leakage to the outside; * three bedrooms; and * "stick" construction (wooden studs, joists and rafters), with batt insulation in walls and blown insulation in attics. Geographic climate factors, regional construction styles (e.g., basement, crawl space or slab-on-grade), and fuel type characteristics (e.g., natural gas or electricity) were then proportionally weighted; and estimated energy use calculated for "typical" composite houses in two climates that represented a weighted average for a Northern and a Southern home. Estimating Energy Savings from Improvements Made to the 'Typical' Home For the purpose of energy estimating savings, EPA assumed that a knowledgeable homeowner or contractor could cost-effectively: * Seal air leaks throughout the house, focusing on leaks to the attic space, through the foundation, and around windows and doors. An average documented baseline value of 0.91 ACHNAT (natural air changes per hour) was used for Northern homes and 0.94 ACHNAT was used for Southern homes. Both Northern and Southern homes were estimated to be improved to a leakage level of 0.50 ACHNAT. * Add insulation to improve R-values from the average documented attic insulation values of R-15 in the North and R-13 in the South to R-38; improve basement rim joists from R-0 to R-11; and improve floors over crawl spaces from R-0 to R-11. Note: In estimating savings opportunities, EPA considered that the 1975–85 construction era coincided with the period after the 1973 oil-embargo when early residential energy conservation measures were first becoming widespread (e.g., storm windows over single-pane/clear glass windows, some caulking & sealing to reduce air leaks, increased attic insulation, etc.). EPA also assumed that original, as-built HVAC and water heating equipment was replaced in the 1990s by 1993–2000 MEC/NAECA-era equipment. Based on these projected cost-effective improvements, EPA estimates the following potential energy and utility bill savings: Location Site MMBTU¹ Savings Utility Bill Savings (2007 data²) North Total House 14% 12% Heating and cooling only 20% 19% South Total House 13% 11% Heating and cooling only 23% 20% ¹ Million British Thermal Units of energy ² From US Dept. of Energy, Energy Information Administration 2007 Short Term Outlook projected US natural gas and electricity prices. Conservatively rounding these projected energy and cost savings, and corroborating modeled results with the field experience of professional home energy contractors, EPA estimates that homeowners can typically save up to 20% of heating and cooling costs (or up to 10% of total energy costs) by air sealing their homes and adding insulation in attics, floors over crawl spaces, and accessible basement rim joists.

US Department of Energy, Renewable Energy Grant Money "HOW TO",

Federal Incentives/Policies for Renewables & Efficiency Printable Version Back U.S. Department of Energy - Loan Guarantee Program Last DSIRE Review: 10/08/2009 Incentive Type: Federal Loan Program State: Federal Eligible Efficiency Technologies: Yes; specific technologies not identified Eligible Renewable/Other Technologies: Solar Thermal Electric, Solar Thermal Process Heat, Photovoltaics, Wind, Hydroelectric, Renewable Transportation Fuels, Geothermal Electric, Fuel Cells, Manufacturing Facilities, Daylighting, Tidal Energy, Wave Energy, Ocean Thermal, Biodiesel Applicable Sectors: Commercial, Industrial, Nonprofit, Schools, Local Government, State Government, Agricultural, Institutional, Any non-federal entity Amount: Varies. Program focuses on projects with total project costs over $25 million. Max. Limit: None stated Terms: Full repayment is required over a period not to exceed the lesser of 30 years or 90% of the projected useful life of the physical asset to be financed Web Site: http://www.lgprogram.energy.gov Authority 1: 42 USC § 16511 et seq. Authority 2: 10 CFR 609 Summary: Innovative Technology Loan Guarantee Program: Title XVII of the federal Energy Policy Act of 2005 (EPAct 2005) authorized the U.S. Department of Energy (DOE) to issue loan guarantees for projects that "avoid, reduce or sequester air pollutants or anthropogenic emissions of greenhouse gases; and employ new or significantly improved technologies as compared to commercial technologies in service in the United States at the time the guarantee is issued." The loan guarantee program has been authorized to offer more than $10 billion in loan guarantees for energy efficiency, renewable energy and advanced transmission and distribution projects. DOE actively promotes projects in three categories: (1) manufacturing projects, (2) stand-alone projects, and (3) large-scale integration projects that may combine multiple eligible renewable energy, energy efficiency and transmission technologies in accordance with a staged development scheme. Under the original authorization, loan guarantees were intended to encourage early commercial use of new or significantly improved technologies in energy projects. The loan guarantee program generally does not support research and development projects. In July 2009, the U.S. DOE issued a new solicitation for projects that employ innovative energy efficiency, renewable energy, and advanced transmission and distribution technologies. Proposed projects must fit within the criteria for "New or Significantly Improved Technologies" as defined in 10 CFR 609. The solicitation provides for a total of $8.5 billion in funding and is to remain open until that amount is fully obligated. The initial due date for applicants was September 16, 2009. Temporary Loan Guarantee Program: The American Recovery and Reinvestment Act of 2009 (ARRA) (H.R. 1), enacted in February 2009, extended the authority of the DOE to issue loan guarantees and appropriated $6 billion for this program. Under this act, the DOE may enter into guarantees until September 30, 2011. The act amended EPAct 2005 by adding a new section defining eligible technologies for new loan guarantees. Eligible projects include renewable energy projects that generate electricity or thermal energy and facilities that manufacture related components, electric power transmission systems, and innovative biofuels projects. Funding for biofuels projects is limited to $500 million. Davis-Bacon wage requirements apply to any project receiving a loan guarantee. In October 2009, the U.S. DOE issued a new solicitation for traditional renewable energy generation projects. The solicitation is funded with $750 million in ARRA funding and is expected to support as much as $4 to 8 billion in lending to eligible projects. The initial deadline for submissions under this solicitation is November 23, 2009. Contact: Public Information - DOE U.S. Department of Energy 1000 Independence Avenue, SW Washington , DC 20585-0121 Phone: (202) 586-8336 E-Mail: LGProgram@hq.doe.gov Web Site: http://www.lgprogram.energy.gov

Mo Dept Natural Resources,MISC Renewable Energy Info, Funding Information

Missouri Missouri Incentives/Policies for Renewables & Efficiency Printable Version Back Energy Loan Program Last DSIRE Review: 04/14/2009 Incentive Type: State Loan Program State: Missouri Eligible Efficiency Technologies: Lighting, Air conditioners, Building Insulation, Windows, Custom/Others pending approval, Other Unspecified Eligible Renewable/Other Technologies: Passive Solar Space Heat, Solar Water Heat, Solar Space Heat, Photovoltaics, Wind, Biomass Applicable Sectors: Schools, Local Government, Institutional, Public Hospitals, Water Treatment Facilities Amount: Varies Maximum Amount: $1 million Terms: Rates set 0.5% below 20-Bond Index interest rate (see website for details); Terms of up to 15 years Program Budget: $3.8 million (FY 2009 application cycle) Expiration Date 10/15/2008 (FY 2009 application cycle, now expired) Web Site: http://www.dnr.mo.gov/energy/financial/loan.htm Authority 1: R.S. Mo. § 640.651 et seq. Date Effective: 1989 Summary: This loan program, administered by the Energy Center of the Missouri Department of Natural Resources (DNR), is available for energy efficiency and renewable energy projects for public and governmental buildings and structures. Loan amounts are based on projected energy savings, resulting in monetary savings that is used to repay the loan. Financing is available at a fixed interest rate below the market rate, and repayment schedules are determined on an individual project basis. Repayment schedules may not exceed 15 years. Loans under this program are determined on a competitive basis according to sector and payback period. Up to $3.8 million in loan funding was available for the FY 2009 funding cycle (expired October 15, 2008) in amounts of up to $1 million. Sector allocations are listed below, with unused funds being made available to other other eligible sectors. * Public Schools (K-12) - 50% * City and County Governments - 25% * Public Higher Education Institutions - 25% Since the program's inception in 1989, loans totaling over $80 million have been made to the applicable sectors, resulting in an estimated savings of $146 million. The Missouri DNR released the list of FY 2009 awardees in December 2008. Contact: Program Information Missouri Department of Natural Resources Energy Center P.O. Box 176 Jefferson City, MO 65102 Phone: (800) 361-4827 Fax: (573) 751-6860 E-Mail: energy@dnr.mo.gov Web Site: http://www.dnr.mo.gov/energy/index.ht

Saint Louis Renewable Energy: Site Map-Saint Louis Renewable Energy Site Map

Saint Louis Renewable Energy: Site Map-Saint Louis Renewable Energy Site Map

Prior Blog Postings Found Here

Site Map-Saint Louis Renewable Energy Site Map

Prior Blog Postings can be found here: http://cdn.automaticsitemap.com/sitemap/25641.html

AMERICAN RECOVERY AND REINVESTMENT ACT OF 2009

Payments for Specified Energy Property in Lieu of Tax Credits under the AMERICAN RECOVERY AND REINVESTMENT ACT OF 2009 U.S. Treasury Department Office of the Fiscal Assistant Secretary July 2009 1 Payments for Specified Energy Property in Lieu of Tax Credits under the American Recovery and Reinvestment Act of 2009 Program Guidance Under Section 1603 of the American Recovery and Reinvestment Tax Act of 2009 (Section 1603), the United States Department of the Treasury (Treasury) makes payments to eligible persons who place in service specified energy property and apply for such payments. The purpose of the payment is to reimburse eligible applicants for a portion of the expense of such property. Eligible property under this program includes only property used in a trade or business or held for the production of income. Nonbusiness energy property described in section 25C of the Internal Revenue Code (IRC) and residential energy efficient property described in section 25D of the IRC do not qualify for payments under this program but may qualify for tax credits under those provisions. By receiving payments for property under section 1603, applicants are electing to forego tax credits under sections 48 and 45 of the IRC with respect to such property for the taxable year in which the payment is made or any subsequent taxable year. Applicants must agree to the terms and conditions applicable to the Section 1603 program. This guidance establishes the procedures for applying for payments under the Section 1603 program and is intended to clarify the eligibility requirements under the program. Treasury welcomes questions about the program and the application process at 1603Questions@do.treas.gov. I. Overview On February 17, 2009, President Obama signed the American Recovery and Reinvestment Act of 2009 (Public Law 111-5). The purpose of the Recovery Act is to preserve and create jobs and promote economic recovery in the near term and to invest in infrastructure that will provide long-term economic benefits. Section 1603 of the Act’s tax title, the American Recovery and Reinvestment Tax Act, appropriates funds for payments to persons who place in service specified energy property during 2009 or 2010 or after 2010 if construction began on the property during 2009 or 2010 and the property is placed in service by a certain date known as the credit termination date (described more fully below in the Property and Payment Eligibility section). Treasury will make Section 1603 payments to qualified applicants in an amount generally equal to 10% or 30% of the basis of the property, depending on the type of property. Applications will be reviewed and payments made within 60 days from the later of the date of the complete application or the date the property is placed in service. Applicants who receive payments for property under Section 1603 are not eligible for the 2 production or investment tax credit under sections 45 and 48 of the IRC with respect to the same property for the taxable year of the payment or subsequent years. In addition, any credit under section 48 previously allowed with respect to progress expenditures for the property will be recaptured. It is expected that the Section 1603 program will temporarily fill the gap created by the diminished investor demand for tax credits. In this way, the near term goal of creating and retaining jobs is achieved, as well as the long-term benefit of expanding the use of clean and renewable energy and decreasing our dependency on non-renewable energy sources. II. Application Procedures Applicants interested in receiving payments under Section 1603 may submit an application on-line by going to www.treasury.gov/recovery. Applications may only be submitted after the property to which the application relates is placed in service, or is under construction. A completed application will include the signed and complete application form; supporting documentation; signed Terms and Conditions; and complete payment information. All applications must be received before the statutory deadline of October 1, 2011. For property placed in service in 2009 or 2010, applications must be submitted after the property has been placed in service and before October 1, 2011. Treasury will review the applications and make payment to qualified applicants within 60 days from the date the completed application is received by Treasury. For property not placed in service in 2009 or 2010 but for which construction began in 2009 or 2010, applications must be submitted after construction commences but before October 1, 2011. If the property has been placed in service at the time of the application, Treasury will make payments to qualified applicants within 60 days from the date the completed application is received. For property not yet placed in service at the time of the application, Treasury will review such applications and notify the applicant if all eligibility requirements that can be determined prior to the property being placed in service have been met. If so notified, applicants must then submit, within 90 days after the date the property is placed in service, supplemental information sufficient for Treasury to make a final determination. Treasury will conduct a final review of the application at that time and make payment to qualified applicants within 60 days after the supplemental information is received by Treasury. Instructions provided on the application will indicate which portions of the application must be completed at the time the application is initially submitted and which portions must be completed at the time the application is supplemented. If an applicant is applying for Section 1603 payments for multiple units of property that are treated as a single, larger unit of property (see Section IV. D. below), all such units may be included in a single application. 3 The application form requests, among other identifying data elements, the applicant’s Data Universal Numbering System (DUNS) number from Dun and Bradstreet. If the applicant does not already have a DUNS number, it may request one at no cost by calling the dedicated toll-free DUNS Number request line at 1-866-705-5711. Applicants must also register with the Central Contractor Registration (CCR). To register, go to www.ccr.gov/startregistration.aspx. The registration must be completed before a payment can be made. When Treasury determines that an application is approved, it will send a notice to the applicant. The notice informs the applicant that the payment will be made and incorporates the information contained in the applicant’s completed application form and the Terms and Conditions. Treasury makes payment to the applicant no later than five days from the date of the notice. Payment will be made by Electronic Funds Transfer based upon the banking information in the CCR. In cases where an applicant has not submitted sufficient information upon which a determination can be based, the applicant will be so notified and given 21 days from the date of the notice to submit additional information. If additional information is not received within the 21 day period, the application will be denied. When Treasury determines that the application does not qualify for payment, the applicant will be so notified. Such notification will include the reasons for the determination and will be considered the final agency action on the application. III. Applicant Eligibility Certain persons are not eligible to receive Section 1603 payments. These include: • any Federal, state or local government, including any political subdivision, agency or instrumentality thereof • any organization that is described in section 501(c) of the IRC and is exempt from tax under section 501(a) of the IRC • any entity referred to in paragraph (4) of section 54(j) of the IRC or • any partnership or other pass-thru entity, any direct or indirect partner (or other holder of an equity or profits interest) of which is an organization or entity described above unless this person only owns an indirect interest in the applicant through a taxable C corporation. As long as each direct and indirect partner in the partnership or shareholder or similar interest holder in any other pass-thru entity is eligible to receive Section 1603 payments, the partnership or pass-thru entity is eligible to receive Section 1603 payments. Having as a direct or indirect partner, shareholder, or similar interest holder a taxable C corporation any of whose shareholders are not eligible to receive Section 1603 payments does not affect the eligibility of the partnership or pass-thru entity. Neither a Real Estate Investment Trust, nor a cooperative organization described in section 1381(a) of the IRC is a pass-thru entity for this purpose. 4 For an applicant to be eligible to receive a Section 1603 payment it must be the owner or lessee of the property and must have originally placed the property in service. Lessees are eligible to apply for Section 1603 payments only if the conditions described in Section VI of this Guidance are met. A foreign person or entity may be eligible for a Section 1603 payment if the person or entity qualifies for the exception in section 168(h)(2)(B) of the IRC. Applicant eligibility will be determined as of the time the application is received. IV. Property and Payment Eligibility A. Placed in Service Qualified property must be originally placed in service between January 1, 2009, and December 31, 2010, (regardless of when construction begins) or placed in service after 2010 and before the credit termination date (see below) if construction of the property begins between January 1, 2009, and December 31, 2010. Qualified property includes expansions of an existing property that is qualified property under section 45 or 48 of the IRC. Placed in service means that the property is ready and available for its specific use. B. Credit Termination Date and Applicable Payment Percentage The following chart lists the Credit Termination Date and the applicable percentage of eligible cost basis used in computing the payment for each specified energy property. Specified Energy Property Credit Termination Date Applicable Percentage of Eligible Cost Basis Large Wind Jan 1, 2013 30% Closed-Loop Biomass Facility Jan 1, 2014 30% Open-loop Biomass Facility Jan 1, 2014 30% Geothermal under IRC sec. 45 Jan 1, 2014 30% Landfill Gas Facility Jan 1, 2014 30% Trash Facility Jan 1, 2014 30% Qualified Hydropower Facility Jan 1, 2014 30% Marine & Hydrokinetic Jan 1, 2014 30% Solar Jan 1, 2017 30% Geothermal under IRC sec. 48 Jan 1, 2017 10%* Fuel Cells Jan 1, 2017 30%** Microturbines Jan 1, 2017 10%*** Combined Heat & Power Jan 1, 2017 10% Small Wind Jan 1, 2017 30% Geothermal Heat Pumps Jan 1, 2017 10% 5 *Geothermal Property that meets the definitions of qualified property in both § 45 and § 48 is allowed either the 30% credit or the 10% credit but not both. ** For fuel cell property the maximum amount of the payment may not exceed an amount equal to $1,500 for each 0.5 kilowatt of capacity. *** For microturbine property the maximum amount of the payment may not exceed an amount equal to $200 for each kilowatt of capacity. C. Beginning of Construction Construction begins when physical work of a significant nature begins. Physical work of a significant nature begins when the requirements of any one of the following options have been met: Self construction. If an applicant manufactures, constructs, or produces property for use by the applicant in its trade or business (or for its production of income), construction begins when physical work of a significant nature begins (including as described in safe harbor below). Physical work does not include preliminary activities such as planning or designing, securing financing, exploring, or researching. For example, in the case of a facility for the production of electricity from a wind turbine, construction begins when physical work of a significant nature commences at the site; that is, when work begins on the excavation for the foundation, the setting of anchor bolts into the ground, or the pouring of the concrete pads of the foundation. Preliminary work, such as clearing a site, test drilling to determine soil condition, or excavation to change the contour of the land (as distinguished from excavation for footings and foundations) does not constitute the beginning of construction. However, if a facility such as a wind turbine and tower unit is to be assembled on-site from modular units manufactured off-site and delivered to the site, construction begins when physical work of a significant nature commences at the off-site location. Construction by contract. For property that is manufactured, constructed, or produced for the applicant by another person under a written binding contract (as described below) that is entered into prior to the manufacture, construction, or production of the property for use by the applicant in its trade or business (or for its production of income) construction begins when physical work of a significant nature begins under the contract. A contract is binding only if it is enforceable under State law against the applicant or a predecessor, and does not limit damages to a specified amount (for example, by use of a liquidated damages provision). For this purpose, a contractual provision that limits damages to an amount equal to at least 5 percent of the total contract price will not be treated as limiting damages to a specified amount. If a contract provides for a full refund of the purchase price in lieu of any damages allowable by law in the event of breach or cancellation, the contract is not considered binding. A contract is binding even if the contract is subject to a condition, as long as the condition is not within the control of either party or a predecessor. A contract will continue to be binding if the parties make insubstantial changes in its terms and conditions or any term is yet to be determined by a standard beyond the control of either party. A contract that imposes significant obligations on the applicant or a predecessor will be treated as binding notwithstanding the fact that certain terms remain to be negotiated by the parties to the contract. An option 6 to either acquire or sell property is not a binding contract. A binding contract does not include a supply, or similar, agreement if the amount and design specifications of the property to be purchased have not been specified. Safe Harbor. An applicant may treat physical work of a significant nature as beginning when the applicant incurs (in the case of an accrual basis applicant) or pays (in the case of a cash basis applicant) more than 5 percent of the total cost of the property (excluding the cost of any land and preliminary activities such as planning or designing, securing financing, exploring, or researching). When property is manufactured, constructed, or produced for the applicant by another person, this test must be met by the applicant, not the other person. For the purpose of determining whether an applicant has incurred more than 5 percent of the total cost of the property, the economic performance standards of IRC section 461(h) apply. D. Units of Property For purposes of determining the beginning of construction of property or the date property is placed in service, all the components of a larger property are a single unit of property if the components are functionally interdependent. Components of property that are produced by, or for, the applicant are functionally interdependent if the placing in service of one component is dependent on the placing in service of the other component. For example, on a wind farm for the production of electricity from wind energy, the electricity generating wind turbine, its tower, and its supporting pad are the single unit of property. Each wind turbine on the wind farm can be separately operated and metered and can begin producing electricity individually. A control system on a wind farm that optimizes the operation of the farm is a unit of property that is separate from the wind turbines. The owner of multiple units of property that are located at the same site and that will be operated as a larger unit may elect to treat the units (and any property, such as a computer control system, that serves some or all such units) as a single unit of property for purposes of determining the beginning of construction and the date the property is placed in service. In such a case, the entire cost of such larger unit of property is taken into account in applying the safe harbor. The owner may not include within this larger unit any property that was placed in service before January 1, 2009. For example, the owner of a wind farm may treat as a single unit a wind farm that will consist of fifty turbines, their associated towers, their supporting pads, a computer system that monitors and controls the turbines, and associated power condition equipment. In cases where the applicant treats multiple units of property as a single unit, failure to complete the entire planned unit will not preclude receipt of a Section 1603 payment. For example, in the example noted above if only 40 of the planned 50 turbines were placed in service by the credit termination date, an otherwise eligible applicant would be eligible for a payment based on the 40 turbines placed in service. E. Specified Energy Property Installed on Other Property Only the portion of a facility that is described in section 48 of the IRC is taken into account in computing the Section 1603 payment. For example, in the case of a building 7 with solar property on its roof, only the cost of the solar property (including the cost of mounting the solar property on the roof) qualifies for a Section 1603 payment; the cost of the building does not qualify. In the case of a truck on which solar energy property is mounted, the cost of the solar energy property and the cost of mounting the property may be eligible for a Section 1603 payment. However, the truck on which the property is mounted is not specified energy property. Likewise, in the case of a forklift powered by a fuel cell power plant, the fuel cell power plant may be eligible for a Section 1603 payment. However, the forklift in which it is used is not specified energy property. F. Location of Property Property which is used predominantly outside the United States does not qualify for a payment under section 1603. The determination of whether property is used predominantly outside the United States is made by comparing the period of time during which the property is physically located outside the United States with the period of time during which the property is physically located within the United States in a given year. If the property is located outside the United States during more than 50% of the year, such property is considered to be used predominantly outside the United States during that year. This limitation does not apply to property described in section 168(g)(4) of the IRC. G. Original Use The original use of the property must begin with the applicant. If the cost of the used parts contained within a facility is not more than 20 percent of the total cost of the facility (whether acquired or self-constructed), an applicant will not fail to be considered the original user of property because the facility contains used parts. If new property is originally placed in service by a person and is sold to an applicant and leased back to the person by the applicant within three months after the date the property was originally placed in service by the person, unless the lessor and lessee elect otherwise, the applicant-lessor is considered the original user of the property and the property is considered to be placed in service not earlier than when it is used under the lease back. H. Required Documentation Applicants must submit supporting documentation demonstrating that the property is eligible property and that it has been placed in service, and if placed in service after December 31, 2010, that construction began in 2009 or 2010 (See section V below for documentation required to support costs). The following documents are required as indicated below: Eligible Property – the following documentation must be provided, as applicable, to demonstrate that the property is eligible (for further details on property eligibility, see sections 45 or 48 of the IRC): Design plans (required of all applicants). Final engineering design documents, stamped by a licensed professional engineer. 8 Documentation demonstrating that the property is designed to have a nameplate capacity that meets required minimums or maximums (see Section 4A of the Application for properties with minimum or maximum nameplate capacity requirements) : [open-loop biomass facility (livestock waste nutrients), marine and hydrokinetic renewable energy facility, fuel cell property, microturbine property, combined heat and power system property, and small wind energy property only]. This documentation can be included within the required design plans or commissioning report, or with the original equipment manufacturer (OEM)/equipment vendor specification sheets. Documentation demonstrating that the property is designed to meet the electricity-only generation efficiency requirements described in Section 4A of the Application (fuel cell property and microturbine property only). The system efficiency is typically calculated as a ratio of the electrical energy output from the device to the amount of fuel consumed to produce the electricity divided by the lower heating value (LHV) of the fuel (if alternating current, be sure to include conversion losses). OEM/equipment vendor specification sheets that specify the above values can be used as supporting documentation for nameplate capacity and system efficiency. This documentation can also be included within the required design plans or commissioning report, as long as it specifies the above values. For combined heat and power system property only, documentation demonstrating that the system is designed to meet the requirements described in Section 4A of the Application. See IRC section 48( c )(3)( C ) for calculation of the system energy efficiency percentage. This documentation can be included within the required design plans or commissioning report, or with OEM/equipment vendor specification sheets. For a closed-loop biomass facility modified to use closed-loop biomass to co-fire with coal, other biomass, or both, documentation demonstrating approval under the Biomass Power for Rural Development Program or documentation demonstrating that the facility is part of a pilot project of the Commodity Credit Corporation. FERC certification (applicable to incremental hydropower production projects only). Certification provided by the Federal Energy Regulatory Commission that certifies the baseline and incremental increase in energy production for incremental hydropower production. FERC license (applicable to hydropower facility installed on a qualifying nonhydroelectirc dam only) Placed in Service - the following documentation must be provided, as applicable, to demonstrate that the property is placed in service: Commissioning report (required for all properties placed in service). A report provided by the project engineer, or the equipment vendor, or an independent third party that certifies that the equipment has been installed, tested, and is ready and capable of being used for its intended purpose. 9 Interconnection agreement (required only for properties placed in service that are interconnected with a utility). A formal document between the applicant and the local utility that establishes the terms and conditions under which the utility agrees to interconnect with the applicant’s system. Applicants must also submit any subsequent documentation to demonstrate that the interconnection agreement has been placed in effect. Under Construction but not yet Placed in Service - the following documentation must be provided, as applicable, to demonstrate that construction has begun on the property: Paid invoices and/or other financial documents demonstrating that physical work of a significant nature has begun on the property as described in Section IV.C. If beginning of construction is based on the safe harbor, these documents must demonstrate that more than 5 percent of the total cost of the property (excluding the cost of any land and preliminary activities such as planning, designing, securing financing, exploring, or researching) has been incurred or paid by the applicant. Binding contract (required for property not yet placed in service that is being manufactured, constructed or produced for the applicant by another person). The binding contract for the manufacture, construction or production of the property as described in section IV.C above. Leased Property - the following documentation must be provided where the applicant is the lessee of the property to demonstrate that the lessor and lessee have entered into the agreement required by section VI of this guidance. The written agreement with the lessor described in Section VI of this Guidance. I. Types of Property Property eligible to receive Section 1603 payments is “specified energy property.” Specified energy property includes only tangible property (not including a building) that is an integral part of the facility. The tangible property is tangible personal property and other tangible property as defined in sections 1.48-1(c) and (d) of the Income Tax Regulations. Specified energy property is property for which depreciation (or amortization in lieu of depreciation) is allowable. Qualified property must be placed in service in 2009 or 2010 or, in the case of property placed in service after 2010 for which construction begins in 2009 or 2010, before the credit termination date. Property that satisfies this placed-in-service requirement may be qualified property even if it is an addition to or expansion of a qualified facility placed in service before 2009. Qualified property includes only tangible property that is both used as an integral part of the activity performed by qualified facility and located at the site of the qualified facility. Qualified property does not include a building but may include structural components of a building. Property is an integral part of a qualified facility if the property is used directly in the qualified facility, is essential to the completeness of the activity performed in that facility, and is located at the site of the qualified facility. Roadways and paved 10 parking areas located at the qualified facility and used for transport of material to be processed at the facility or equipment to be used in maintaining and operating the facility are integral to the activity preformed there, but roadways or paved parking lots that provide solely for employee and visitor vehicle traffic are not an integral part a qualified facility. Property is considered used as an integral part of a qualified facility if so used either by the owner of the property or by the lessee of the property. In the case of an open-loop biomass, closed-loop biomass, or municipal solid waste facility, an integral part of the qualified facility includes property used at the plant site for unloading, transfer, storage, reclaiming from storage, or preparation (shredding, chopping, pulverizing, or screening) of the material to be processed at the plant. However, similar equipment located away from the plant site is not an integral part of the qualified facility. Similarly, slurry pipelines, trucks, railroad cars, and barges that transport to the qualified facility open-loop biomass, closed-loop biomass, or municipal solid waste are not an integral part of a qualified facility. Property that is integral to a geothermal facility includes equipment that transports geothermal steam or hot water from a geothermal deposit to the site of ultimate use. This includes components of a heating system, such as pipes and ductwork that distribute within a building the energy derived from the geothermal deposit and, if geothermal energy is used to generate electricity, includes equipment that transports hot water from the geothermal deposit to a power plant. For qualified property that generates electricity, qualified property includes storage devices, power conditioning equipment, transfer equipment, and parts related to the functioning of those items but does not include any electrical transmission equipment, such as transmission lines and towers, or any equipment beyond the electrical transmission stage, such as transformers and distribution lines. Specified energy property, within the meaning of Section 1603, consists of two broad categories of property - certain property described in IRC section 45 and certain property described in IRC section 48. The following types of property are specified energy property within the meaning of Section 16031: Generally, a qualified facility must be capable of operating as an independent unit even though the property is installed at the site of an existing facility. Certain modifications to property installed on an existing facility qualify as specified energy property even if the facility was placed in service before 2009. Qualified Facilities described under IRC section 45: A qualified facility is a facility as described in IRC section 45(d)(1), (2), (3), (4), (6), (7), (9), or (11), but only if no credit has been allowed under section 45 for the facility. This guidance does not address the placed-in-service requirements of IRC section 45. 1 The property descriptions included in this Guidance are intended to assist applicants in determining if a property qualifies for funding. They are not intended to change the meaning of the terms as they are used in sections 45 or 48 of the IRC. 11 Wind facility: A wind facility is a facility using wind to produce electricity (wind turbines 100kW or less may also qualify as qualified small wind energy property, but only one payment is allowed with respect to the property). Closed-loop biomass facility: A closed-loop biomass facility uses closed-loop biomass to produce electricity. Closed-loop biomass is any organic material from a plant that is planted exclusively for purposes of being used at a qualified facility to produce electricity. A closed loop biomass facility includes the modifications to a facility that was originally placed in service and modified to use closed-loop biomass to co-fire with coal, with other biomass, or with both, but only if the modification is approved under the Biomass Power for Rural Development Programs or is part of a pilot project of the Commodity Credit Corporation as described in 65 Fed. Reg. 63052. Open-loop biomass facilities: An open-loop biomass facility uses open-loop biomass to produce electricity. Open-loop biomass is any agriculture livestock waste nutrients or any solid, nonhazardous, cellulosic waste material or any lignin material that is derived from qualified sources. • Agricultural livestock waste nutrients are agriculturale livestock manure and litter, including wood shavings, straw, rice hulls, and other bedding material for the disposition of manure. Agricultural livestock includes bovine, swine, poultry, and sheep. • The qualified sources from which solid, nonhazardous, cellulosic waste material or any lignin material must be derived are: 1. Any of the following forest-related resources: mill and harvesting residues, precommercial thinnings, slash, and brush; 2. Solid wood waste materials, including waste pallets, crates, dunnage, manufacturing and construction wood wastes (other than pressure-treated, chemically-treated, or painted wood wastes), landscape or right-of-way tree trimmings, but not including municipal solid waste, gas derived from the biodegradation of solid waste, or paper that is commonly recycled; and 3. Agriculture sources, including orchard tree crops, vineyard, grain, legumes, sugar, and other crop by-products or residues. An open-loop biomass facility does not include: • A facility that burns fossil fuel (co-firing) beyond such fossil fuel required for startup and flame stabilization; or • A facility using agricultural livestock waste nutrients that has a nameplate capacity rating of less than 150 kilowatts. Geothermal facility: A geothermal facility uses geothermal energy to produce electricity. Geothermal energy is energy derived from a geothermal deposit. A geothermal deposit is a geothermal reservoir consisting of natural heat that is stored in rocks or in an aqueous liquid or vapor (whether or not under pressure). 12 Landfill gas facilities: A landfill gas facility is a facility producing electricity from gas derived from the biodegradation of municipal solid waste. Trash facilities: A trash facility is a facility, other than a landfill gas facility, that uses municipal solid waste to produce electricity. In the case of a new unit placed in service in connection with a trash facility placed in service before October 23, 2004, only property related to the new unit can qualify as specified energy property that is eligible for a Section 1603 payment. Qualified hydropower facility: Incremental hydropower: A facility that produces incremental hydropower production described in IRC section 45(c)(8)(B). The percentage of incremental hydropower and baseline must be certified by the Federal Energy Regulatory Commission. The determination of incremental hydropower production shall not be based on any operational changes at such facility not directly associated with the efficiency improvements or additions of capacity. Only property related to the efficiency improvements and additions to capacity to which the incremental hydropower production is attributable can qualify as specified energy property that is eligible for a Section 1603 payment. Nonhydroelectric dam: Qualified hydropower facilities also include any hydropower producing facility described in IRC section 45(c)(8)(C) (relating to hydroelectric projects installed on a nonhydroelectric dams that were placed in service before August 8, 2004, and did not produce hydroelectric power on August 8, 2004). The hydroelectric project must be licensed by the Federal Energy Regulatory Commission and must meet all other applicable environmental, licensing, and regulatory requirements. The hydroelectric project must be operated so that the water surface elevation at any given location and time that would have occurred in the absence of the hydroelectric project is maintained, subject to any license requirements imposed under applicable law that change the water surface elevation for the purpose of improving environmental quality of the affected waterway. The Secretary of the Treasury, in consultation with the Federal Energy Regulatory Commission, shall certify that the hydroelectric project licensed at a nonhydroelectric dam meets these criteria. Only property related to the turbines or other generating devices added to the facility to produce hydroelectric power can qualify as specified energy property that is eligible for a Section 1603 payment. Marine and hydrokinetic renewable energy facilities: A marine or hydrokinetic renewable energy facility is a facility that produces electricity from marine and hydrokinetic renewable energy and has a nameplate capacity rating of at least 150 kilowatts. Marine and hydrokinetic renewable energy is energy derived from: • Waves, tides, and currents in oceans, estuaries, and tidal areas, free flowing water in rivers, lakes, and streams; • Free flowing water in an irrigation system, canal, or other man-made channel, including projects that utilize nonmechanical structures to accelerate the flow of water for electric power production purposes; or 13 • Differentials in ocean temperature (ocean thermal energy conversion). Marine and hydrokinetic renewable energy does not include any energy that is derived from any source that utilizes a dam, diversionary structure (except as provided above for man-made projects), or impoundment for electric power production purposes. Energy property described under IRC section 48: Specified energy property for purposes of Section 1603 includes, in addition to qualified property that is part of a qualified facility, any other energy property described under IRC section 48. Such energy property must meet performance and quality standards that are prescribed either in IRC section 48 or in associated Treasury Regulations and that are in effect at the time of the acquisition of the property. Solar property: Equipment that uses solar energy to generate electricity, to heat or cool (or provide hot water for use in) a structure, or to provide solar process heat, excepting property used to generate energy for the purposes of heating a swimming pool; equipment that uses solar energy to illuminate the inside of a structure using fiber-optic distributed sunlight. Geothermal property: Equipment used to produce, distribute, or use energy derived from a geothermal deposit, but only, in the case of electricity generated by geothermal power, up to (but not including) the electrical transmission stage. A geothermal deposit is a geothermal reservoir consisting of natural heat that is stored in rocks or in an aqueous liquid or vapor (whether or not under pressure). Qualified fuel cell property: Qualified fuel cell property is a fuel cell power plant that has a nameplate capacity of at least 0.5 kilowatt of electricity using an electrochemical process and has an electricity-only generation efficiency greater than 30%. A fuel cell power plant is an integrated system comprised of a fuel cell stack assembly and associated balance of plant components that converts a fuel into electricity using electrochemical means. Payments for qualified fuel cell property cannot exceed an amount equal to $1,500 for each 0.5 kilowatt of capacity of such property. Qualified microturbine property: Qualified microturbine property is a stationary microturbine power plant that has a nameplate capacity of less than 2,000 kilowatts and has an electricity-only generation efficiency of not less than 26% at International Standard Organization conditions. A stationary microturbine power plant is an integrated system comprised of a gas turbine engine, a combustor, a recuperator or regenerator, a generator or alternator, and associated balance of plant components which converts a fuel into electricity and thermal energy. The microturbine power plant also includes all secondary components located between the existing infrastructure for fuel delivery and the existing infrastructure for power distribution, including equipment and controls for meeting relevant power standards, such as voltage, frequency, and power factors. Payments for qualified 14 microturbine property cannot exceed an amount equal to $200 for each kilowatt of capacity of such property. Combined heat and power (CHP) system property: Combined heat and power system property is property comprising a system that meets the following requirements: • The system uses the same energy source for the simultaneous or sequential generation of electrical power, mechanical shaft power, or both in combination with the generation of steam or other forms of useful thermal energy (including heating and cooling applications). • The system-- o Produces at least 20% of its total useful energy in the form of thermal energy that is not used to produce electrical or mechanical power (or combination thereof); and o Produces at least 20% of its total useful energy in the form of electrical or mechanical power (or combination thereof); and o Has a system energy efficiency percentage in excess of 60%. This requirement does not apply to a facility designed to use biomass [within the meaning of IRC section 45(c)(2) and (3) without regard to the last sentence of paragraph (3)(A)] for at least 90% of the energy source. (See IRC section 48(c)(3)(C) for calculation of the system energy efficiency percentage and IRC section 48(c)(3)(D) for the reduction in payment for biomass systems with an energy efficiency of less than 60%.) o Does not have a capacity in excess of 50 megawatts or a mechanical energy capacity in excess of 67,000 horsepower or an equivalent combination of electrical and mechanical energy capacities. CHP system property does not include property used to transport the energy source to the facility or to distribute energy produced by the facility. Qualified small wind energy property: Qualified small wind energy property is property that uses a qualifying small wind turbine to generate electricity. A qualifying small wind turbine is a wind turbine that has a nameplate capacity of not more than 100 kilowatts. Geothermal Heat Pump Property: Equipment that uses the ground or ground water as a thermal energy source to heat a structure or as a thermal energy sink to cool a structure. V. Eligible Basis The basis of property is determined in accordance with the general rules for determining the basis of property for federal income tax purposes. Thus, the basis of property generally is its cost (IRC section 1012), unreduced by any other adjustment to basis, such as that for depreciation, and includes all items properly included by the taxpayer in the depreciable basis of the property, such as installation costs and the cost for freight 15 incurred in construction of the specified energy property. If property is acquired in exchange for cash and other property in a transaction described in IRC section 1031, in which no gain or loss is recognized, the basis of the newly acquired property is equal to the adjusted basis of the other property plus the cash paid. Costs that will be deducted for federal income tax purposes in the year in which they are paid or incurred are not includible in the basis on which the payment is determined. For example, if the applicant will take the IRC section 179 deduction for all or part of the cost of the property, then no payment is allowed for the portion of the cost of the property for which the IRC section 179 deduction will be taken. For geothermal property, if intangible drilling and development expenses will be deducted by the applicant, no payment will be allowed on the costs that will be deducted as intangible drilling and development expenses. If the applicant will capitalize intangible drilling and development expenses, only those costs that may be recovered through depreciation are includible in the basis on which the payment is allowed. However, if the applicant will elect under IRC § 59(e) to deduct intangible drilling and development costs over 60 months, the payment is based on the amount for which the election under § 59(e) applies because the effect of § 59(e) is to treat these costs as amortizable. Only the cost basis of property placed in service after 2008 is eligible for a Section 1603 payment. Thus, if property is placed in service in 2009 at a qualified facility that was placed in service in an earlier year, only the basis of the property placed in service in 2009 is eligible for a Section 1603 payment. Limitation on eligible basis. The eligible basis of a qualified facility does not include the portion of the cost of the facility that is attributable to a non qualifying activity. For example, for a biomass facility that burns fuel other than open-loop biomass or closed-loop biomass, the eligible cost basis is the percentage of total eligible costs that is equal to the percentage of the electricity produced at the facility that is attributable to the open-loop biomass and closed-loop biomass. This limitation does not reduce the eligible basis of a facility that qualifies as a modification of an existing facility. For example, eligible basis includes the entire cost of modifying an existing facility to use closed-loop biomass to co-fire with coal, with other biomass, or with both, if the modification is approved under the Biomass Power for Rural Development Programs or is part of a pilot project of the Commodity Credit Corporation as described in 65 Fed. Reg. 63052. Similarly, the eligible basis of a qualified hydropower facility producing incremental hydropower includes the entire costs of the modification even though only a portion of the power produced from the modification is attributable to the modification. Applicants must submit with their application for a Section 1603 payment documentation to support the cost basis claimed for the property. Supporting documentation includes a detailed breakdown of all costs included in the basis. Other supporting documentation, such as contracts, copies of invoices, and proof of payment must be retained by the applicant and made available to Treasury upon request. For properties that have a cost basis in excess of $500,000 applicants must submit an independent accountant’s 16 certification attesting to the accuracy of all costs claimed as part of the basis of the property. VI. Leased Property A lessor who is eligible to receive a Section 1603 payment with respect to a property may elect to pass-through the Section 1603 payment to a lessee. The election may only be made with respect to property that would be eligible for the Section 1603 payment if owned by the lessee. Such an election will treat the lessee as having acquired the property for an amount equal to the independently assessed fair market value of the property on the date the property is transferred to the lessee and will generally follow the rules in the IRC and Treasury regulations governing elections to allow lessees to receive energy tax credits. The lessor and lessee must agree that the lessor waives all right to a Section 1603 payment or a production or investment tax credit with respect to the eligible property, before the lessee may apply for a Section 1603 payment with respect to such property. The lessee must agree to include ratably in gross income over the five year recapture period an amount equal to 50 % of the amount of the Section 1603 payment. In order to make this election, both the lessor and the lessee must be persons eligible to receive a payment under Section 1603. Additionally, this election may not be made by a lessor that is a mutual savings bank or similar financial organization, a regulated investment company or a real estate investment trust. The election of a lessor to allow the lessee to receive a Section 1603 payment may be made with respect to each property leased by the lessor to the lessee. The lessee's written consent is required. The lessor’s election is made by a written agreement with the lessee that contains the following information: • A waiver of the lessor’s right to receive any payment under Section 1603 with respect to the property, as well as a waiver of the lessor’s right to claim a production or investment tax credit under sections 45 and 48 of the IRC with respect to the same property for the taxable year of the payment or subsequent years; • All information necessary to determine the amount of lessee’s Section 1603 payment; • The name, address, and employer identification number of the lessor and the lessee; • A description of each property with respect to which the election in being made; • The date on which possession of the property is transferred to the lessee; and • The lessee’s consent to the election. A copy of this agreement must be included in the lessee’s application for the Section 1603 payment. This election is irrevocable. Special Rule for Sale-leaseback Transaction In a sale-leaseback transaction, the lessee, who is not the owner of the property, may claim the Section 1603 payment, if three conditions are satisfied: 17 • First, the lessee must be the person who originally placed the property in service. • Second, the property must be sold and leased back by the lessee, or must be leased to the lessee, within three months after the date the property was originally placed in service. • Third, the lessee and lessor must not make an election to preclude application of the sale-leaseback rules. VII. Recapture If the applicant disposes of the property to a disqualified person or the property ceases to qualify as a specified energy property within five years from the date the property is placed in service (hereinafter “disqualifying event”), the Section 1603 payment must be repaid to the Treasury as follows: 100% of the payment must be repaid if the disqualifying event takes place within one year from the date placed in service; 80% of the payment must be repaid if the disqualifying event takes place after one year but before two years from the date placed in service; 60% of the payment must be repaid if the disqualifying event takes place after two years but before three years from the date placed in service; 40% of the payment must be repaid if the disqualifying event takes place after three years but before four years from the date placed in service; and 20% of the payment must be repaid if the disqualifying event takes place after four years but before five years from the date placed in service. Property is considered to have been disposed of to a disqualified person if any interest in the property or in the applicant or in any partnership or pass-thru entity that is a direct or indirect owner of an interest in the applicant is sold to: any Federal, state or local government, including any political subdivision, agency or instrumentality thereof; any organization that is described in section 501(c) of the IRC and is exempt from tax under section 501(a) of the IRC; any entity referred to in paragraph (4) of section 54(j) of the IRC; or any partnership or other pass-thru entity any partner (or other holder of an equity or profits interest) of which is a Federal, state or local government, including any political subdivision, agency or instrumentality thereof; an organization that is described in section 501(c) of the IRC and is exempt from tax under section 501(a) of the IRC; or an entity referred to in paragraph (4) of section 54(j) of the IRC. A taxable corporation some or all of whose shareholders are disqualified persons is not a disqualified person and such a corporation’s ownership of an interest in a partnership or other pass-thru entity will not cause the partnership or other entity to be treated as a disqualified person. Property ceases to qualify as a specified energy property if the use of the property changes so that it no longer qualifies as specified energy property. For example, use of property predominantly outside the United States in a year will result in recapture. Temporary cessation of energy production will not result in recapture provided the owner of the property intends to resume production at the time production ceases. Permanent cessation of production will result in recapture. Permanent cessation of production due to natural disaster will not result in recapture unless the property is replaced with property for which a Section 1603 payment is allowed. Replacement would be treated as occurring if the applicant uses IRC section 1033 to avoid gain recognition. 18 For a hydropower property where incremental hydropower production has been licensed by FERC, recapture will not take place if actual incremental increases in energy production do not occur that year due to environmental and/or regulatory factors. Recapture for a hydropower facility installed on a nonhydroelectric dam will occur if the Federal Energy Regulatory Commission license is surrendered or repealed based on significant changes in water surface elevation caused by operation of the facility. If the amount of the Section 1603 payment depends on the percentage of electricity produced from biomass (in the case of closed-loop and open-loop biomass facilities) or the energy efficiency percentage (in the case of combined heat and power system property using biomass) and the percentage is reduced, a proportionate percentage of the property ceases to qualify as specified energy property. The applicable percentages will be determined on an annual basis for the year beginning on the date the property is placed in service and for each succeeding year within the recapture period. No additional grant will be allowed in a subsequent year in which the percentage increases. Selling or otherwise disposing of the property to an entity other than a disqualified person does not result in recapture provided the property continues to qualify as a specified energy property and provided the purchaser of the property agrees to be jointly liable with the applicant for any recapture. Recapture would occur in the event the property is resold to a disqualified person or ceases to qualify as a specified energy property. The applicant remains jointly liable to the Treasury for the recapture amount even if the applicant no longer has control over the property. Where a lessor elects to pass through the Section 1603 payment to a lessee, if the lessor sells the property to a disqualified person, the lessee is liable to the Treasury for the recapture amount even if the lessee maintains control over the property. If the lease is terminated and possession of the property is transferred by the lessee to the lessor or any other person, the lessee is liable to the Treasury for the recapture amount if the use of the property changes during the recapture period so that it no longer qualifies as specified energy property. Applicants are not required to post a bond as a condition of receiving payment under the section 1603 program and receipt of payment does not create a lien on the property in favor of the United States. However, funds that must be repaid to the Treasury under these rules are considered debts owed to the United States and if not paid when due, will be collected by all available means against any assets of the applicant, including enforcement by the United States Department of Justice. Debts arising under these rules are not considered tax liabilities. VIII. Miscellaneous Provisions A. Assignment of Payment Applicants may submit, along with their request for payment, a Notice of Assignment, assigning the payment to a third party provided the requirements of the Federal Assignment of Claims Act (31 U.S.C. 3727) are met. The Notice of Assignment will 19 20 include the DUNS number for the third party. The third party will be required to register in CCR. B. National Environmental Protection Act (NEPA) A Section 1603 payment with respect to specified energy property does not make the property subject to the requirements of NEPA and similar laws. C. Davis- Bacon A 1603 payment with respect to specified energy property does not make the property subject to the requirements of the Davis-Bacon Act. D. Treatment of Payments as Taxable Income Except as described in Section IV of this Guidance with respect to leased property, a Section 1603 payment with respect to specified energy property is not includible in the gross income of the applicant. The basis of the property is reduced by an amount equal to 50% of the payment. E. Real Estate Investment Trusts A Real Estate Investment Trust (REIT) will be eligible to receive Section 1603 payments only to the extent allowed by section 50 of the IRC. IRC section 50(d)(1) specifies that rules similar to the rules of former IRC section 46(e) will apply. IRC section 46(e)(1)(B) provides that, in general, in the case of a REIT, qualified investment is limited to the REIT’s ratable share of such qualified investment. The ratable share is a ratio, the numerator of which is its taxable income and the denominator of which is its taxable income computed without regard to the deduction for dividends paid (provided by IRC section 857(b)(2)(B)). For this purpose, the REIT’s taxable income is determined without regard to any deduction for capital gains dividends and by excluding any net capital gain. F. Applicability of Normalization Rules Payments received under the Section 1603 program must be normalized. See former IRC Section 46(f). G. Reporting Applicants will be required to provide reports, as required by Treasury, including an annual performance report as set forth in the Terms and Conditions.

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