### Question
What does qualified electric utility mean?


### Answer
**Qualified electric utility** has the following meaning in *26 U.S.C. § 451*:

> a person that, as of the date of the qualifying electric transmission transaction, is vertically integrated, in that it is both—


(A) a transmitting utility (as defined in section 3(23) of the Federal Power Act (16 U.S.C. 796(23))) with respect to the transmission facilities to which the election under this subsection applies, and


(B) an electric utility (as defined in section 3(22) of the Federal Power Act (16 U.S.C. 796(22)))

#### Citation:
  - *26 U.S.C. § 451*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter E-Accounting Periods and Methods of Accounting > PART II-METHODS OF ACCOUNTING > Subpart B-Taxable Year for Which Items of Gross Income Included**

