A bill to amend the Internal Revenue Code of 1986 to establish a tax credit for qualified combined heat and power system property, and for other purposes.
Analysis under review: This bill has generated analysis that may be too generic or incomplete. Clause-level evidence remains available below.
Summary
What This Bill Does
This bill creates a new federal tax credit for businesses that install combined heat and power (CHP) systemsâtechnology that simultaneously generates electricity and useful thermal energy from a single fuel source. The credit equals 10% of the cost of qualifying CHP property, with potential bonuses of 10 additional percentage points each for using domestically manufactured components and for locating in energy communities (areas affected by fossil fuel industry closures).
Who Benefits and How
Businesses and industrial facilities that install CHP systems benefit from significant tax savings, reducing the cost of energy efficiency investments. Manufacturers of CHP equipment benefit from increased demand. Energy communities and areas with domestic manufacturing capacity receive additional investment incentives. Facilities using biomass fuels qualify under relaxed efficiency rules, benefiting the biomass energy sector.
Who Bears the Burden and How
The federal government bears the cost through reduced tax revenue from the credits claimed. All taxpayers indirectly bear this cost through either higher taxes elsewhere or increased federal deficits. The Secretary of the Treasury and Secretary of Energy bear administrative burdens for establishing performance standards and issuing implementing regulations.
Key Provisions
- Creates new Section 48F in the Internal Revenue Code with a base 10% investment tax credit for CHP systems
- Adds 10 percentage point bonus for projects meeting domestic content requirements
- Adds 10 percentage point bonus for projects in energy communities
- CHP systems must produce at least 20% thermal and 20% electrical energy, exceed 60% efficiency, and begin construction after December 31, 2024
- Caps eligible system size at 50 megawatts (67,000 horsepower) with pro-rata reduction above 25 megawatts
- Provides special rules for biomass-fueled systems with relaxed efficiency requirements
Evidence Chain:
This summary is generated from the full bill text using AI analysis. Expand "Detailed Analysis" below for identified beneficiaries/burden bearers.
At a Glance
What This Bill Does
Establishes a new investment tax credit (Section 48F) for qualified combined heat and power (CHP) system property, providing a base 10% credit with bonus credits for domestic content and energy community siting.
Key Policy Areas
Energy, Taxation
Primary Purpose
Establishes a new investment tax credit (Section 48F) for qualified combined heat and power (CHP) system property, providing a base 10% credit with bonus credits for domestic content and energy community siting.
Policy Domains
Whole Bill
Identified Gains
Contextual inference, no direct clause citation- Industrial and commercial CHP system operators
- CHP equipment manufacturers
- Biomass energy producers
- Energy communities
Contextual inference, no direct clause citation
Identified Costs
Contextual inference, no direct clause citation- Federal government (reduced tax revenue)
- U.S. taxpayers
Contextual inference, no direct clause citation
Legislative Progress
In CommitteeMrs. Blackburn introduced the following bill; which was read twice …
Read twice and referred to the Committee on Finance.
Introduced in Senate
Impact analysis is available but no clear stakeholder effects identified. View clause-level analysis →
Bill Structure & Actor Mappings
Who is "The Secretary" in each section?
- "the_secretary"
- → Secretary of the Treasury (with consultation from Secretary of Energy for performance standards)
Key Definitions
Terms defined in this bill
We use a combination of our own taxonomy and classification in addition to large language models to assess meaning and potential beneficiaries. High confidence means strong textual evidence. Always verify with the original bill text.
Learn more about our methodology