The Treasury Department proposed tax guidance on Monday that makes tribal businesses eligible for direct cash payments for low-carbon energy projects, a move aimed at expanding access to a $30 billion pot from the Inflation Reduction Act.

The guidance seeks to clarify a decades-long uncertainty over the tax status of corporations fully owned by one or more tribes. The draft rules say that these businesses hold the same tax status as the tribes that own them, making them eligible to take advantage of IRA benefits to build energy projects.

The announcement comes as reservation lands are 46 percent less likely to host wind farms and 110 percent less likely to host solar farms than adjacent lands, according to a new study in Nature Energy.

Tribes, which are not subject to income taxes, can take advantage of many of the IRA’s clean energy benefits thanks to a provision in the 2022 law called “direct pay.” Along with nonprofits and schools, tribes building clean energy projects such as solar farms can get paid up to 30 percent of their value in cash, according to IRA tax rules finalized in March.