Introduction

The Inflation Reduction has reshaped how developers, investors, construction companies, and tax advisors must analyze energy tax credit eligibility. As legacy production and investment tax credits under sections 45 and 48 give way to their tech‑neutral counterparts under sections 45Y and 48E, longstanding questions around project definition, prevailing wage and apprenticeship compliance, domestic content, capacity thresholds, and registration requirements are being revisited through a new regulatory lens.

To help clarify these differing standards, the following table provides a side‑by‑side comparison of how key definitional and compliance concepts apply across the major energy tax credit regimes. By distilling IRS notices, Treasury regulations, and recent guidance into a unified format, this summary highlights where the rules remain consistent and where the tech‑neutral framework introduces meaningful departures. Practitioners can use this reference to better assess project structuring considerations, anticipate documentation needs, and understand how the definitional contours of a “project,” “facility,” or “energy property” affect tax credit qualification and quantification.

Conclusion

The distinctions captured in this table underscore how the Inflation Reduction Act’s credit architecture turns on threshold definitions that, while technical, have material consequences for project economics, financing structures, and compliance strategies. By consolidating these rules in one place, the table aims to provide a practical roadmap for navigating a landscape where the contours of a “project” increasingly dictate the availability and magnitude of federal clean‑energy tax credits.

[1] Notice 2022-61, 2022-52 I.R.B. 560 (“To determine when construction begins for purposes of §§ 30C, 45V, 45Y, and 48E, principles similar to those under Notice 2013-29 regarding the Physical Work Test and Five Percent Safe Harbor apply, and taxpayers satisfying either test will be considered to have begun construction.”).The eight factors are:

(a) The facilities are owned by a single legal entity;
(b) The facilities are constructed on contiguous pieces of land;
(c) The facilities are described in a common power purchase agreement or agreements;
(d) The facilities have a common intertie;
(e) The facilities share a common substation;
(f) The facilities are described in one or more common environmental or other regulatory permits;
(g) The facilities were constructed pursuant to a single master construction contract; and
(h) The construction of the facilities was financed pursuant to the same loan agreement.

Notice 2013-29, § 4.04(2); Notice 2018-59 § 7.01(2)(a) (but referring to “energy properties” rather than “facilities”).

[2] Treasury Decision 10024 (Jan. 8, 2025), which finalized regulations under sections 45Y and 48E (the “2025 Treasury Decision”), says:

Notice 2022-61 provides guidance regarding the PWA requirements and provides guidance for determining the beginning of construction of a facility for the section 45Y and 48E credits. Section 5 of the Notice provides that, to determine when construction begins for purposes of sections 30C, 45V, 45Y, and 48E, principles similar to those under Notice 2013-29, 2013-20 I.R.B. 1085, regarding the Physical Work Test and Five Percent Safe Harbor apply, and taxpayers satisfying either test will be considered to have begun construction. … The Treasury Department and the IRS have determined that the existing Internal Revenue Bulletin guidance (referred to as the IRS Notices) adequately addresses the beginning of construction rules applicable to sections 45Y and 48E. Additionally, modifications to the beginning of construction guidance provided by the IRS Notices for sections 45 and 48 are beyond the scope of these final regulations (emphasis added).

[3] Supra note 1.

[4] Supra note 2.

[5] Treas. Reg. § 1.45-6(a)(1) (“a qualified facility (as defined in section 45)”).

[6] See Treas. Reg. § 1.45-8(c)(2) (“The allowable ratio of apprentices to journeyworkers on the job site in any occupation and its corresponding classification on any day must comply with the applicable apprentice-to-journeyworker ratio of the registered apprenticeship program in accordance with 29 CFR part 29” (emphasis added).); Treas. Reg. § 1.45-8(f)(2)(i)(D), Ex. 4 (“For each day, all journeyworkers and qualified apprentices employed by the contractors are on the job site” (emphasis added).).

[7] Treas. Reg. § 1.45Y-3(a) (“any qualified facility”).

[8] Supra note 6.

[9] Treas. Reg. § 1.48-13(d)(1) (“For purposes of the increased credit amount [for satisfying the prevailing wage and apprentice requirements], the domestic content bonus amount …, the term energy project means one or more energy properties … that are operated as part of a single energy project. Multiple energy projects will be treated as one energy project if they are owned by a single taxpayer (subject to the related taxpayer rule …) and any four or more of the following [seven] factors are present.”).

[10] Treas. Reg. §§ 1.48E-2(d), -3(a).

[11] The 2025 Treasury Decision says,

Although the apprenticeship requirements provided in section 48E(d)(4) applies rules similar to section 45(b)(8) rather than section 48(a)(11), an appropriate reading of the statute is to apply a consistent interpretation to both of section 48E’s prevailing wage requirements and apprenticeship requirements, as inconsistent interpretations would frustrate congressional intent by creating different standards for the prevailing wage requirements and apprenticeship requirements and would be difficult for the IRS to administer. For the reasons noted in this Summary of Comments and Explanation of Revisions, interpreting the PWA requirements for section 48E consistently with section 48(a)(10) is the best implementation of the overall statutory framework because it results in the PWA requirements being applied appropriately and consistently across credits” (emphasis added)).

[12] Supra note 6.

[13] See Notice 2023-38, § 2.01.

[14] Id.

[15] Treas. Reg. § 1.48-13(d)(1).

[16] See 2025 Treasury Decision (“The PWA requirements are applied to the qualified facility or EST … Likewise, determining whether the increased credit amounts for domestic content and energy communities also apply to a qualified facility” (emphasis added)); Notice 2023-38, § 2.01 (“For purposes of this notice, an “Applicable Project” refers to: (i) a qualified facility under §§ 45 or 45Y; (ii) an energy project under § 48, which may include qualified property for which a valid irrevocable election under § 48(a)(5) has been made to treat such qualified property as energy property under § 48; or (iii) a qualified investment with respect to a qualified facility or energy storage technology under § 48E.”).

[17] Treasury Decision 9998 (Jun. 19, 2024) (“the definition of a qualified facility under section 45 governs for purposes of the One Megawatt Exception under section 45(b)(6)(B)(i). Accordingly, the application of the aggregation principles issued under Notice 2013-29 and Notice 2018-59 is outside the scope of these final regulations.”).

[18] Treas. Reg. § 1.45Y-3(c)(3) (“a qualified facility is treated as having integrated operations with any other qualified facility of the same technology type if the facilities are owned by the same or related taxpayers, placed in service in the same taxable year; and transmit electricity generated by the facilities through the same point of interconnection or, if the facilities are not grid-connected … are able to support the same end user” (emphasis added)).

[19] Treas. Reg. §§ 1.48-13(d)(1), -13(e)(1).

[20] Treas. Reg. § 1.48E-3(c)(4) (Same technology and (A) same or related owners; (B) placed in service in the same tax year; and (C) same point of interconnection (or if behind the meter able to support the same end user)).

[21] Treas. Reg. §§ 1.48-14(h)(3)(i), 14(h)(7) (examples 1-5).

[22] Treas. Reg. § 1.48E-4(a)(3)(i) (“The nameplate generating capacity of the unit of qualified facility is measured independently from any other qualified facilities that share the same integral property.”).

[23] Treas. Reg. § 1.48(e)-1(b)(3).

[24] Treas. Reg. § 1.48E(h)-1(b)(3)(iv) (Same technology and (A) same or related owners; (B) placed in service in the same tax year; and (C) same point of interconnection (or if behind the meter able to support the same end user).

[25] Treas. Reg. § 1.6418-2(b)(2)(i) (“A transfer election must be made separately with respect to each eligible credit property described in §1.6418-1(d)(2), (3), (5), and (7), as applicable, for which an eligible credit is determined.”).

[26] Id.

[27] Treas. Reg. §§ 1.6418-1(d)(9)(i) “(an energy property”); -1(d)(9)(ii) (“At the option of an eligible taxpayer … an energy project”). EY writes that the regulation “appears to provide optionality for filing at either the unit (e.g., block) or the project level for IRC Section 48 pre-filing registration and election purposes.” Ernst & Young LLP, IRS final regulations on transferring energy credits under IRC Section 6418 adopt proposed regulations with few modifications, Tax Alert (May 8, 2024).

[28] Treas. Reg. § 1.6418-1(d)(11).