N-2018-15: New Clean Renewable Energy Bonds

Notice 2018-15 provides that the IRS shall not process applications for, or issue allocations of, the remaining unused authority to issue new clean renewable energy bonds under § 54C of the Internal Revenue Code (the Code) under Notice 2015-12, 2015-10 I.R.B. 700, and Notice 2017-66, 2017-45 I.R.B. 487.  Section 54C of the Code was repealed by section 13404 of Public Law No. 115-97, 131 Stat 2138 (2017), effective for bonds issued after December 31, 2017.

Notice 2018-15 will be in IRB 2018-8, dated February 20, 2018.

New Clean Renewable Energy Bonds

Notice 2018-15

SECTION 1. PURPOSE

This Notice withdraws the solicitations in Notice 2015-12, 2015-10 I.R.B. 700, and Notice 2017-66, 2017-45 I.R.B.487, for applications for the remaining unused national limitation of authority to issue new clean renewable energy bonds (New CREBs) under § 54C of the Internal Revenue Code (the Code). Section 54C of the Code was repealed by section 13404 of Public Law No. 115-97, 131 Stat 2138 (2017) (Public Law No. 115-97), effective for bonds issued after December 31, 2017.

SECTION 2. BACKGROUND

Section 54C of the Code authorized the issuance of up to $2.4 billion (volume cap) of New CREBs for qualified renewable energy facilities (as defined in §54C(d)(1)) (projects). Section 54C(c)(2) provided that up to 1/3 of the volume cap is to be allocated to projects to be owned by public power providers, governmental bodies, and cooperative electric companies, respectively.

Notice 2015-12 solicits applications for allocations of the remaining available volume cap of New CREBs for projects to be owned by public power providers, governmental bodies, and cooperative electric companies. Section 4.c. of Notice 2015 – 12 provides that applications for projects to be owned by governmental bodies or 2 cooperative electric companies may be submitted beginning on March 5, 2015. Section 5.a.(ii) of Notice 2015-12 provides that, except as otherwise provided by section 5 of Notice 2015-12, the Internal Revenue Service (IRS) will allocate the remaining available volume cap designated for projects to be owned by governmental bodies or cooperative electric companies, respectively, on a first-come, first-served basis by order of submission date (as defined in section 4.a. of Notice 2015-12). Notice 2015-12 provides no deadline for applications for projects to be owned by governmental bodies or cooperative electric companies. Under section 4.b. of Notice 2015-12, the deadline for applications for projects to be owned by public power providers is June 3, 2015.

The IRS later identified $379,549,691.35 of remaining available volume cap designated for projects to be owned by public power providers. Notice 2017-66 solicits applications from qualified issuers of New CREBs for projects to be owned by public power providers, and sets forth June 19, 2018, as the due date for submitting applications. See section 3 of Notice 2017-66.

SECTION 3. STATUS OF ALLOCATIONS AND THE APPLICATION PROCESS

Section 13404(a) of Public Law No.115-97 provides, in part, that part IV of subchapter A of chapter 1 of the Code is amended by striking subpart I, which contained §54C of the Code. Section 13404(d) of Public Law No. 115-97 provides that the amendments made by section 13404 shall apply to bonds issued after December 31, 2017. Accordingly, no bond issued after December 31, 2017, under any allocation of volume cap issued by the IRS under Notice 2015-12, may be treated as a New CREB. In addition, the IRS will not be processing applications for, or issuing allocations of, New CREBs volume cap under Notice 2015-12 or Notice 2017-66.

SECTION 4. EFFECT ON OTHER DOCUMENTS

This Notice obsoletes Notice 2015-12 in part by withdrawing the solicitation of applications for, and discontinuing the allocation of, New CREBs volume cap under sections 3, 4, and 5 of Notice 2015-12. All other provisions of Notice 2015-12 remain in effect for bonds issued on or prior to December 31, 2017. This Notice obsoletes Notice 2017-66.

SECTION 5. DRAFTING INFORMATION

The principal author of this Notice is Zoran Stojanovic of the Office of Associate Chief Counsel (Financial Institutions and Products). For further information regarding this Notice, contact Mr. Stojanovic at 202-317-6980 (not a toll-free call).