The Offshore Wind Act, as amended by the Economic Development Act, also establishes a refundable Wind Power Incentive Investment credit for offshore wind companies subject to tax under G.L. c. 62 or G.L. c. 63. See G.L. c. 62, § 6(cc) and G.L. c. 63, § 38MM.[18] A certified offshore wind company may, to the extent authorized by the offshore wind tax incentive program established in G.L. c. 23J, § 8A(d), claim a credit equal to up to 50 percent of its total capital investment in an offshore wind facility.[19] The total amount of the credit awarded is distributed in equal parts over five taxable years corresponding to the period for which the offshore wind company is certified.[20]
The eligibility requirements for the Wind Power Incentive Investment credit vary depending on whether the certified offshore wind company owns or leases the offshore wind facility. However, in general, the certified offshore wind company must demonstrate to the Center that (i) it has a total capital investment in an offshore wind facility that equals not less than $35,000,000; and (ii) that the offshore wind facility will employ not less than 200 new full-time employees by the fifth year of the offshore wind company’s certification.[21] Where the certified offshore wind company is a tenant of an offshore facility, the certified offshore wind company must also demonstrate that it leases an area of the offshore wind facility that represents not less than 25 per cent of the owner’s capital investment in the facility. Further, in such cases, the amount of credit to be awarded in a taxable year cannot exceed the certified offshore wind company’s total lease payments for leasing the facility in the taxable year.[22]
A certified offshore wind company claiming the credit may not also claim the Wind Power Incentive Jobs Credit or the Economic Development Incentive Program Credit provided by G.L. c. 62, § 6(g) and G.L. c. 63, § 38N in the same taxable year.[23] In the event a taxpayer’s certification as an offshore wind company is revoked or the certified offshore wind company fails to create 200 new full-time employees by the fifth year of its certification, recapture of the credit may be required.[24] The credit is subject to the offshore wind tax incentive program’s annual cap of $35,000,000.[25]
For certified offshore wind companies subject to tax under G.L. c. 62, the credit will be attributed on a pro rata basis to the owners, partners, or members of the legal entity, who can claim the credit in a manner determined by the Commissioner.[26]
The Commissioner is to promulgate regulations to administer the credit and to establish a process for recapturing the value of the credit where the offshore wind company’s certification is revoked by the Center.[27]
The credit is available for certified offshore wind companies subject to tax under G.L. c. 62 or G.L. c. 63 for taxable years beginning on or after January 1, 2023. The credit will not be available for taxable years beginning on or after January 1, 2033.[28]