At the beginning of the year, Congress extended the PTC through 2013 and expanded the credit to include projects that were able to commence construction in 2013, although the legislation did not provide guidance on what level of construction would need to be achieved to qualify.
The IRS notice describes two ways facilities can qualify:
1) if “physical work of a significant nature” has begun that includes a “contiguous program of construction,” or
2) a Safe Harbor provision can be met that includes incurring costs of 5% of more of the total cost of the facility in addition to an effort to continue construction.
Federal Update: Uncertainty surrounds tax credit for wind energy in New England