Bill offers 30% tax credit for hydroelectric dam upgrades

What does this do?

This bill creates a 30% federal tax credit for certain improvements to existing hydroelectric dams. Qualifying projects include installing fish passages, improving water quality, removing old dams, making dams safer, and connecting small remote dams of up to 20 megawatts to off-grid communities. The project must have written approval from a federal, state, or local authority before January 1, 2032, and the property must be placed in service after December 31, 2022.

Who does it affect?

Dam owners and operators, including businesses, utilities, and other organizations that pay federal taxes, may qualify. Those who do not owe enough federal taxes to use the credit directly may be able to transfer it or receive a direct payment instead.

Why does it matter?

Dam owners who make qualifying improvements may be able to reduce their federal tax bill through this credit. Communities not connected to the main power grid could see changes in their local energy supply if nearby small dams are brought into service.

What does it cost, and who pays?

• 30% credit on qualifying improvements
• No total spending cap specified

Where does it stand?