2023 Laws of Puerto Rico › TITLE THIRTEEN - Taxation and Finance (§§ 1 — 33423) › Subtitle 15 - Puerto Rico Industrial Incentives Generally (§§ 10001 — 10855) › PART III - Other Tax Incentives (§§ 10401 — 10855) › Chapter 942 - Green Energy Incentives Act of Puerto Rico (§§ 10421 — 10446) › Subchapter II - Green Energy Investment Incentives (§§ 10422 — 10442) › § 10429 - Green Energy Investment Reimbursement Program

(a) As of the effective date of this act, the following incentives shall be granted to the owners of production units engaged in green energy production and sale based on the production unit capacity and pursuant to the following:
(1) First level. — Small-scale green energy projects:
(A) An incentive shall be granted to small-scale green energy project production units equal to the amount resulting from multiplying:
(i) The reference cost per watt of the technology used by the production unit; by
(ii) the installed capacity of the concerned production unit; by
(iii) the percentage of the partial reimbursement determined by the Administration for the technology used by such production unit; Provided, however, That under no circumstances the total amount of the incentive shall exceed sixty percent (60%) of the installation cost of the production unit.
(B) The Administration shall periodically publish, at least once every fiscal year, the green energy production technologies eligible to participate in the incentive program, the partial reimbursement percentage established for each of those technologies, as well as the reference cost for each technology, such reference cost shall be determined by the Administration based on the objective criteria to be established through regulations.
(C) The incentives granted under paragraph (A) of this clause shall be disbursed from the Green Energy Fund, and be limited to the funds budgeted by the Administration for such purposes for the corresponding fiscal year.
(D) The Administration shall exclusively retain the power to evaluate and approve the applications for incentives filed by the owners of small-scale green energy project production units under this clause which power may be exercised with specialized advisers. The Administration is hereby empowered to authorize participating financial institutions and cooperatives to receive and process applications for incentives under this clause, as well as to disburse the incentives granted pursuant thereto, subject to such conditions and requirements established by the Administration through regulation.
(E) The members of a controlled group of corporations, as such term is defined in § 10421 of this title, may receive incentives under this clause for just one small-scale green energy project per controlled group per fiscal year of the Government of Puerto Rico.
(2) Second level. — Medium-scale green energy projects:
(A) An incentive shall be granted to medium-scale green energy project production units equal to the amount resulting from multiplying: (i) the percentage of the partial reimbursement determined by the Administration for the technology used by such production unit; by (ii) the installation cost of the production unit; Provided, however, That under no circumstances the total amount of the incentive shall exceed fifty percent (50%) of the installation cost of the production unit. Such incentive shall be determined according to the following procedure:
(i) The incentives granted under this clause shall be adjudicated quarterly, that is, four times a year, as determined by the Administration.
(ii) The Administration shall publish quarterly, at least thirty days prior to the commencement of each quarter, the green energy production technologies eligible to participate in the incentive program, the percentage of the partial reimbursement established for such quarter for each one of said technologies, as well as the funds available for incentives on such quarter for each technology.
(iii) The incentives provided under this clause shall be granted by means of competitive adjudication, as established through regulations, from among the projects submitted. This competitive adjudication process shall be exempt from the applicability of the provisions of §§ 2101 et seq. of Title 3, known as the “Uniform Administrative Procedure Act of Puerto Rico”. For such purposes, the adjudication notice shall include the terms for its review.
(iv) The proposing owner of a medium-scale green energy project shall submit a proposal to the Administration, not later than the fifth day of the first month of the applicable quarter.
(v) The Administration shall adjudicate incentives taking into account that the proposals are consistent with the applicable specifications; the terms of delivery; the ability of the proponent to enter into and comply with the contract; the economic responsibility of the proponent, his/her reputation and integrity; the quality and the type of equipment; the energy production cost; the incentives or benefits received by the proponent from other sources; the available funds for each technology; and any other conditions that the Administration may deem reasonable.
(vi) Not later than forty (40) days after the due date of the term to submit the proposals, the Administration shall notify its determination through certified mail to the proponents whose projects were denied. Any competitive adjudication shall be carried out before the next quarter begins. The Administration shall notify the proponents not selected on the reasons why the incentives were not granted.
(vii) The proponents whose projects were denied shall have ten (10) days as of the day of notice to request reconsideration. The filing of a request for reconsideration shall be a jurisdictional requirement to request judicial review.
(viii) The Administration shall issue a final notice of denial not later than fifteen (15) days as of the date of filing of the request for reconsideration.
(ix) If the Administration denies, accepts or takes no action within fifteen (15) days as of the filing of the reconsideration, the term to request judicial review shall start to count once again as of the day of notice of such determination or as of the expiration of the fifteen (15) days to consider it, as the case may be.
(x) The proponents who receive an adverse final notice may request judicial review by the filing a request for judicial review with the Court of Appeals within a jurisdictional term of ten (10) days as of the adverse final notice. Consistent with the interest of maintaining an efficient process within the Administration, in accordance with the competitive adjudication process provided in this chapter, the mere filing of a request for judicial review with the Court of Appeals shall not automatically stay the processes before the Administration, but rather such stay remedy must be requested through a motion and justified by complying with all the requirements for an order in aid of jurisdiction. Any order issued by the Court of Appeals to stay the procedures before the Administration must be issued within a five (5) -day term as of the request, and any order issued within such five (5) -day term may only affect or apply in a limited manner to the amount being challenged, thus the Administration may grant the incentives to the other selected projects up to the total amount available after deducting the sum of the incentives applicable to the project or projects under judicial review. If the Court of Appeals does not issue a stay order within five (5) days as of the filing of the motion requesting such remedy, the Administration shall carry out the competitive adjudication as if no request for judicial review was filed. However, if the Court of Appeals issues a stay order within the five (5) -day term as of the filing of the request for judicial review was filed, then, the Administration shall grant the incentives of the other selected projects without delay, deducting the sum of the incentives applicable to the project or projects under judicial review. No other judicial review procedure or request may be initiated or filed in addition to the one provided for in this chapter or with terms and procedures other than those herein established.
(B) The document of adjudication of the partial reimbursement of each medium-scale green energy project shall establish the terms and conditions that the Administration may deem necessary or convenient, including, but not limited to, the term granted by the Administration for the construction and installation of the project, which term shall not exceed two (2) years. The Administration may, upon sworn petition by the proponent, extend such term in the event of force majeure or other circumstances that the Administration may deem meritorious; Provided, That in these cases, the Administration may require the posting of a bond to guarantee the completion of the project.
(C) The incentives granted under paragraph (A) of this clause shall be disbursed from the Green Energy Fund, and be limited to the funds budgeted by the Administration for such purposes available for the corresponding fiscal year.
(D) The Administration shall be charged with the administration of the available funds as well as the disbursement of the incentives granted under paragraph (A) of this clause.
(E) The proponents of projects classified under this production level may submit incentive proposals for more than one project per controlled group per quarter of the Government of Puerto Rico. However, regardless of the number of projects submitted by the members of a controlled group or by developers, the aggregate of all the proposals submitted by the members of a controlled group or developers for such quarter of the Government of Puerto Rico, shall be deemed to be one single project for the purpose of determining that such project is a medium-scale project.
(F) The competitive adjudication process and the criteria to evaluate and select the projects to be granted the incentives provided under paragraph (A) of this clause shall be subject to the provisions of this chapter or the regulations promulgated by the Administration.
(G) The Administration may reject any proposal submitted when, in its judgment deems that, among other factors:
(i) The proponent or his/her contractors lack the knowledge, the necessary experience or financial or technical capacity necessary to carry out the project;
(ii) the nature or quality of the equipment or the proposed green energy technology does not meet the requirements stated by the Administration;
(iii) the proposed green energy technology has not been certified by the Administration;
(iv) the quoted prices exceed the reference cost, or
(v) the project would not benefit the public interest.
(H) Proponents who apply for the incentives provided under paragraph (A) of this clause shall declare, under penalty of perjury, whether the green energy project, object of the proposal, is covered by one or more industrial or tax incentive laws, other tax incentives received by it, and the law or laws granting such incentives, when submitting the proposal to apply for the benefits provided under paragraph (A) of this clause. Noncompliance with this requirement shall be sufficient cause to deny the requested incentives.
(b) Large-scale Green Energy Projects Incentive Program. — The Administration is hereby directed to establish a Green Energy Incentive Program, in collaboration with the Authority. Such program shall be established in accordance with this chapter and have the purpose of granting incentives to large-scale green energy project owners. Under this program, the Administration shall also establish a mechanism to develop a market to trade RECs related to large-scale green energy projects, which shall include, but not be limited to, the purchase and sale of RECs. The Administration shall adopt the regulations, orders, and guidelines needed to establish this program, including, but not limited to, the contracting mechanisms to be employed by production unit owners. The Authority shall cooperate with the Administration in developing and implementing this program.
(c) In order to determine the level of production applicable to one specific fiscal year or quarter of the Government of Puerto Rico for the purpose of the incentives available under subsection (a) of this section:
(1) All the members of a controlled group of corporations as defined in § 10421 of this title, shall be deemed to be, in the aggregate, one single producer, and
(2) all proposals and projects submitted during a fiscal year or quarter of the Government of Puerto Rico by the members of a controlled group of corporations or by developers shall be deemed to be one single project for such specific fiscal year or quarter of the Government of Puerto Rico.
(d) In the case of businesses engaged in green energy production or green energy producers operating under any industrial or tax incentive law:
(1) If, after June 30, 2011, they claim any special credit or deductions conferred by such industrial or tax incentive acts with respect to an investment in a production unit, including the credit described in § 10645(d) of this title, they shall be unable to avail themselves of the incentives granted under this section, including those available under the green energy incentive program, during the term of their decree or grant under the industrial or tax incentive acts, including the extensions to such decree or grant, and
(2) such businesses that are not described in clause (1) of this subsection, and which apply for the incentives provided in this section, may not claim the special credits or deductions conferred by such industrial tax incentive laws, including businesses described in § 10645(d) of this title, with respect to the production unit object of the incentives under this chapter, including those available under the Green Energy Incentive Program. Businesses engaged in green energy production shall choose between the incentive provided in this section or the credits granted under the applicable industrial and tax incentive laws, since they may not avail themselves of both benefits with respect to a specific production unit.
(e) Collection of debts against granted incentives. — The Department of the Treasury may collect on the incentive granted to any business engaged in green energy production or any green energy producer at any of the levels described in this section, any debt that such person may have with the Department of the Treasury except for debts that have been challenged or are under review.
(f) The Administration shall establish the fees and charges to be collected on account of the processing of the incentives established in this section, which shall be deposited into a Special Fund created to such effects by the Secretary of the Treasury with the purpose of defraying the regular operating expenses of the Administration, therefore, any surplus at the end of the fiscal year shall be transferred to the General Fund of the Treasury of Puerto Rico, upon previous notice to the Office of Management and Budget of the Government of Puerto Rico.
(g) The Green Energy Fund shall be the owner of the environment and social attributes of the projects that have been granted incentives under clauses (1) and (2) of subsection (a) of this section, whether an REC or not; Provided, That if a green energy producer has been granted incentives under subsection (a)(2) of this section with respect to any production unit, such producer shall be bound to transfer to the Green Energy Fund of Puerto Rico, free of charge, any REC in connection with such production unit.
History —July 19, 2010, No. 83, § 2.8.