A bipartisan bill from Sens. Lindsey Graham and Maria Cantwell would give utilities greater flexibility to apply unused clean energy tax credits to rebuilding energy infrastructure damaged by natural disasters.
The “Disaster Zone Energy Affordability and Investment Act” would grant energy companies flexibility for unused tax credits — including applying them to past tax years — provided the credits are invested in rebuilding or upgrading energy infrastructure in areas officially designated as disaster zones.
“This bill incentivizes energy companies to support reconstruction efforts in communities hit hard by Helene and other natural disasters,” said Graham, referring to the September 2024 hurricane. “By allowing energy companies to utilize unused tax credits, it will spur recovery and, over time, pass savings on to consumers.”
Under current law, utilities can either sell or apply unused energy tax credits — such as the investment and production tax credits created under the Inflation Reduction Act — to offset federal tax liabilities. However, those options are limited. Tax credits generally can cover no more than 75 percent of a company’s tax liability and cannot be applied to past or future tax years.
