Tracy Warren, NRECA
Phone: (703) 907-5746
Cell: (703) 517-3411
ARLINGTON, VA, September 14, 2010 – The Internal Revenue Service (IRS) has officially opened a supplemental application round of New Clean Renewable Energy Bonds (New CREBs) available exclusively to electric cooperatives. The new round will award the unallocated portion -- $191 million -- of the $800 million of national bond Volume Cap made available to co-ops in 2009. The application deadline is November 1, 2010.
Prior to the CREB program, which was created by the Energy Policy Act of 2005, cooperatives had been hampered in their efforts to develop renewable energy by their inability, as not-for-profit entities, to take advantage of the production tax credits available to for-profit firms. Since the start of the program, the new bonds have contributed to significant growth in renewable energy capacity owned by cooperatives.
Cooperatives are using the new bonds to develop an array of renewable projects, including, among others, wind, geothermal, closed-loop biomass (trees grown expressly for electricity production), open-loop biomass (sawdust, tree trimmings, farm byproducts, animal waste, landfill gas), small hydropower (less than 25 MW), and solar energy systems..
On March 18, 2010, the President signed into law H.R. 2847, the “Hiring Incentives to Restore Employment Act.” The legislation includes a major enhancement to the Clean Renewable Energy Bond (CREB) program that is available to all recipients of these new CREB allocations.
The enhancement, known as the “direct pay” option, will allow co-op CREB issuers to receive a direct payment from the Federal government, designed to reimburse the issuer for 70 percent of the projected interest cost (calculated by Treasury) on these bonds.
Allocations of New CREBs Volume Cap are valid for three years after the date of the letter issuing the allocation.
New Clean Renewable Energy Bonds Application Announcement