New IRA Provision Could Triple Clean Energy Tax Equity Market, Boosting Sales to $60 Billion Annually.

The Inflation Reduction Act (IRA) provision allowing the buying and selling federal production and investment tax credits could more than triple the $20 billion annual tax equity market for clean energy in the US. The new provision allows for more streamlined sales of tax credits by clean energy developers and a larger pool of buyers. This could help developers earn revenues by selling tax credits, reduce tax burdens while financing new projects, and utilities may increase ownership of low-cost clean energy to reduce customer rates. However, cost, complexity, and tax credit transferability remain challenges. Tax credit sales are ramping up more quickly than expected, with forecasts of potential $60 billion annual sales in the near term.