Investment in alternative fuels and the continued development of renewable generation sources is ever increasing. In 2004, reported by a Worldwatch Institute report, the global investment in renewable energy hit a record $30 billion, accounting for 20-25 percent of all investment in the power industry. With political and global warming concerns that investment will continue for the foreseeable future.
How does this impact electric utilities and your R&D efforts?
For starters, many utilities are investing in research along with the Department of Energy (DOE) in research and demonstration projects. These projects are often times co-funded by the DOE but the non-reimbursed component of these projects should be assessed for possible R&D activities and claims.
A new example – GM Teams with Utilities on Plug-In Cars:
A recent article in the Wall Street Journal, highlighted that General Motors Corp. is collaborating with three dozen electric utilities to collaborate on plug-in electric vehicles that are to be rolled out in about two years.
The focus of the efforts is to make sure that the new vehicles’ recharging processes mesh with the electricity grid and don’t inadvertently undermine grid reliability. The article highlights that to be successful the new automobiles must integrate into the nuances and differences between various electric grid systems as well as upgrading intelligence on the utility side to match the intelligence embedded in the cars (e.g., computer chips and software needs). Side note – Intelligence integration sounds to us like the potential next level of integration and use of smart meters.
Reminder – Alternative Simplified Credit (ASC) Election:
Our understanding is that if your company wants to take advantage of the Alternative Simplified Credit (ASC) calculation method, you need to make the election on your 2007 tax claim regardless of whether or not you are making an R&D credit claim or not.
New News – Possible Permanent R&D Tax Credit
Recent publications indicate that both Barack Obama and John McCain support establishing a permanent R&D tax credit for companies.
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BCP is an engineering services firm with 26 years of engineering experience and know-how. Over the last six years, we have developed a unique approach to R&D and an experienced team of R&D engineers and professionals that work for and with your tax group to provide complete and accurate technical substantiation for your R&D claim.