The Section 45X tax credit under the Inflation Reduction Act (IRA) is specifically designed to incentivize the production of 50 critical minerals. These minerals are crucial for various clean energy technologies, including solar panels, wind turbines, and batteries. The 10% credit applies to the production costs of these minerals to specified levels of purity, covering both “material costs and extraction costs” for mining and production purposes.
While the exact list of these 50 minerals is not detailed in the provided sources, they typically include key components such as lithium, cobalt, and rare earth elements, which are vital for the development of clean energy technologies. The legislation aims to support domestic production and reduce reliance on imported minerals, particularly from China, which dominates global critical mineral production.
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