By: Martha G. Pugh, Mary Burke Baker, David Wang

On 1 June 2023, the US Department of the Treasury (Treasury) and Internal Revenue Service (IRS) issued a notice of proposed rulemaking (NOPR) regarding the Low-Income Communities Bonus Credit Program (Program) established under Section 48(e) of the Internal Revenue Code (Code), pursuant to the Inflation Reduction Act of 2022 (IRA).¹ The Program provides for increases in the amount of energy investment credits available under Code Section 48(a) (Section 48(e) Increase) to certain applicants by allocating environmental justice solar and wind capacity limitation (Capacity Limitation) to qualified facilities.

The IRS previously released Notice 2023-17, which provided initial guidance for potential applicants seeking allocations of calendar year 2023 Capacity Limitation.

This NOPR generally adopts the guidance set forth in Notice 2023-17 but, critically, changed many important aspects, imposed additional qualification requirements, and clarified previously undefined terms. This alert provides an overview of this NOPR and specifically discusses the following:

• What solar and wind facilities qualify for the Section 48(e) Increase;
• The four categories of qualified facilities;
• The specific “financial benefits” (Financial Benefits) requirements for facilities otherwise eligible for a 20% Section 48(e) Increase;
• Ineligibility of facilities placed in service prior to Capacity Limitation allocation;
• Additional criteria that, if met, allow qualified facilities to get priority Capacity Limitation allocation; and
• Conditions that will lead to post-Capacity Limitation allocation disqualification from, and recapture of, the Section 48(e) Increase.

To read the full alert, please click here.

Hydrogen production technology, according to the joint EPO-IEA report summarizing patent trends in the hydrogen economy (summarized here), accounts for the largest percentage of patenting activity since 2011 among the three primary stages of the hydrogen value chain (i.e., (i) production, (ii) storage, distribution, and transformation, and (iii) end-use industrial applications). Trends show a shift in hydrogen production from carbon-intensive methods to technologies that do not rely on fossil fuels. The bulk of recent increased patent activity is directed to electrolysis development, while patent activity related to production from biomass and waste has decreased.

Read the rest of this post on K&L Gates’ IP Law Watch blog.

By Jason Engel, Ben Fechner and Clare Frederick

The European Patent Office (EPO) and the International Energy Agency (IEA) recently published a joint report summarizing innovation and patent trends within the hydrogen economy.¹ The report is based on global patent activity since 2001² and is intended to help governments and businesses understand which parts of the hydrogen value chain appear to be making progress and which parts may be lagging behind.³ The report dives deep into specific technologies, lists the most active applicants in select technologies, and attempts to identify the impact of different governmental programs in specific sectors, with a goal of trying to help focus future innovation efforts.

Read the rest of this post on K&L Gates’ IP Law Watch Blog.