S. 5453: Grid Resiliency Tax Credit Act

This bill would create a new federal tax credit for certain electric power transmission lines and related substation equipment. In simple terms, it would lower the tax burden for companies and other taxpayers that build or upgrade large power lines that help move electricity across regions.

What the tax credit would be

The bill adds a new 30% investment tax credit for qualified electric power transmission lines. The credit would apply to eligible costs for building, reconstructing, or upgrading transmission lines and some connected substation property.

Eligible costs would include things like:

• conductors or cables
• towers and insulators
• transformers, circuit breakers, and converters
• other equipment that is part of a substation, converter station, or switchyard
• property that improves a line’s capacity, efficiency, reliability, resilience, or safety

Which projects would qualify

The credit would apply to transmission lines that meet specific criteria. In general, the line would need to be:

• a large transmission line with at least 500 megawatts of capacity, or a qualified generator tie line
• part of a project that crosses state lines, connects multiple transmission planning regions, runs across or within the outer continental shelf, or extends at least 100 continuous miles
• built after December 31, 2026, or, in some cases, upgraded after that date in a way that increases capacity

The bill also includes technical voltage and equipment requirements, such as minimum voltage levels and, for some lines, the use of advanced transmission conductors.

What kinds of lines are included

The bill distinguishes between two main categories:

• Qualified significant transmission lines — large lines that move power across states, regions, or long distances.
• Qualified generator tie lines — lines used mainly to connect new or expanded power generation facilities, or energy storage systems, to the grid.

How the credit could be used

The bill would allow the credit to be:

• claimed directly by eligible taxpayers
• transferred to another taxpayer
• paid out directly in some cases under existing elective payment rules

It also makes clear that these direct payments would not be reduced through sequestration under budget enforcement rules.

Other rules and limitations

The bill would bar taxpayers from getting this new credit for property that already qualifies for certain other clean energy or investment credits, so the same property generally could not receive multiple overlapping credits.

The credit would apply to property whose construction begins after December 31, 2026, and would stop applying to property whose construction begins after December 31, 2036.

Broader purpose

The bill states that Congress views transmission expansion as important for grid reliability, resilience, and access to more electricity sources. In practical terms, the bill is designed to encourage more investment in long-distance power lines and related infrastructure by making those projects cheaper after taxes.

Relevant Companies

• NEE — NextEra Energy may benefit if it builds or upgrades transmission assets that qualify for the credit through its utility or transmission businesses.
• DUK — Duke Energy could be directly affected if its transmission expansion projects qualify for the new credit.
• AEP — American Electric Power operates large transmission networks and could use the credit for eligible transmission investments.
• EXC — Exelon’s utility operations may be impacted if transmission projects in its service areas qualify.
• XEL — Xcel Energy could be affected by incentives for qualifying transmission buildout.
• SO — Southern Company may see direct effects from transmission projects eligible for the credit.
• PNW — Pinnacle West may be affected if affiliated utility transmission investments qualify.
• ETN — Eaton supplies electrical equipment that could see increased demand from transmission and substation projects, though the bill would not directly subsidize Eaton itself.
• EMR — Emerson could be indirectly affected through grid equipment and control systems demand.