§ 1.45Y-3. Rules relating to the increased credit amount for prevailing wage and apprenticeship.

¶(1) A qualified facility with a maximum net output of less than one megawatt (as measured in alternating current) determined based on the nameplate capacity as provided in paragraph (c) of this section (One Megawatt Exception);

¶(2) A qualified facility the construction of which began prior to January 29, 2023; or

¶(3) A qualified facility that meets the prevailing wage requirements of section 45(b)(7) and § 1.45-7, the apprenticeship requirements of section 45(b)(8) and § 1.45-8, and the recordkeeping and reporting requirements of § 1.45-12 with respect to the construction, alteration, or repair of a qualified facility within the meaning of section 45Y.

¶(1) In general. For purposes of paragraph (b)(1) of this section, the determination of whether a qualified facility has a maximum net output of less than 1 megawatt (MW) of electrical energy (as measured in alternating current) is determined based on the nameplate capacity of the qualified facility. If a qualified facility has integrated operations with one or more other qualified facilities, then the aggregate nameplate capacity of the qualified facilities is used for the purposes of determining if the qualified facility meets the requirements of paragraph (b)(1) of this section. The nameplate capacity for purposes of the One Megawatt Exception is the maximum electrical generating output in megawatts that a qualified facility is capable of producing on a steady state basis and during continuous operation under standard conditions, as measured by the manufacturer and consistent with the definition of nameplate capacity provided in 40 CFR 96.202. If applicable, the International Standard Organization conditions should be used to measure the maximum electrical generating output.

¶(2) Nameplate capacity for qualified facilities that generate in direct current for purposes of the One Megawatt Exception. For qualified facilities that generate electricity in direct current, the taxpayer determines the maximum net output (in alternating current) of each qualified facility by using the lesser of:

¶(3) Integrated operations. Solely for the purposes of the One Megawatt Exception, 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 or are delivering electricity directly to an end user behind a utility meter, are able to support the same end user.

¶(4) Related taxpayers—

¶(1) In general. Except as provided in paragraph (d)(2) of this section, this section applies to qualified facilities placed in service in taxable years ending after January 15, 2025, and the construction of which begins after January 15, 2025. Taxpayers may apply this section to qualified facilities placed in service in taxable years ending on or before January 15, 2025, and qualified facilities placed in service in taxable years ending after January 15, 2025, the construction of which begins before January 15, 2025, provided that taxpayers follow this section in its entirety and in a consistent manner.

¶(2) Paragraph (b)(1) of this section. Paragraph (b)(1) of this section applies to qualified facilities placed in service in taxable years ending after January 15, 2025, and the construction of which begins after March 17, 2025. Taxpayers may apply this section to qualified facilities placed in service in taxable years ending on or before January 15, 2025, the construction of which begins before January 15, 2025, provided that taxpayers follow this section in its entirety and in a consistent manner.