July 1st, 2024

For the first time ever, the Inflation Reduction Act (IRA) allows tax-exempt and governmental entities, including Tribal Nations, to take advantage of tax credits for qualifying projects. With elective pay, Tribal Nations can receive a direct payment equal to the full value of tax credits for qualifying infrastructure projects, with emphasis on clean energy projects.

Red Lake Nation is taking advantage of this new opportunity via the expansion of a solar energy project. The beginnings of Red Lake’s journey toward energy independence via a solar project funded by elective pay were covered in a June 24th episode of Marketplace. The episode includes some of the challenges presented with Elective Pay, along with the long-term benefits. The proposed project is utility-scale at about 15 megawatts and would feature energy storage and a substation. The entire reservation can run on five to seven megawatts of power, and the plan is for Red Lake Nation to sell the remaining power, creating a new revenue stream for the Tribal Nation.

As Tribal Nations seek to understand the potential of the IRA’s elective pay provision, this Marketplace episode and Red Lake’s project provide an example of one Tribal Nation’s experience in navigating this opportunity. We encourage you to listen to the episode and take advantage of our growing body of additional resources on this provision.

Established in 2023, the USET Tribal Infrastructure Development Program is a national outreach and education effort to increase awareness of and access to recently enacted infrastructure funding in Indian Country. We have established this program to help ensure Tribal Nations understand potential new funding opportunities, including the elective pay provision, as well as provide advocacy for Tribal interests, both on and off our homelands. Please visit our webpage for more information.

For questions please contact Melanie Plucinski, Tribal Infrastructure Policy Analyst, at mplucinski@usetinc.org. 

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Established in 1969, the United South and Eastern Tribes, Inc. (USET) is a non-profit, inter-Tribal organization serving thirty-three (33) federally recognized Tribal Nations from the Northeastern Woodlands to the Everglades and across the Gulf of Mexico. USET is dedicated to enhancing the development of Tribal Nations, improving the capabilities of Tribal governments, and improving the quality of life for Indian people through a variety of technical and supportive programmatic services.

Established in 2014, the USET Sovereignty Protection Fund (USET SPF) is a non-profit, inter-Tribal organization advocating on behalf of thirty-three (33) federally recognized Tribal Nations from the Northeastern Woodlands to the Everglades and across the Gulf of Mexico. USET SPF is dedicated to promoting, protecting, and advancing the inherent sovereign rights and authorities of Tribal Nations and in assisting its membership in dealing effectively with public policy issues.