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Stand-alone energy storage tax credit legislation introduced in both the House and Senate

By Kelly Pickerel | March 10, 2021

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On March 9, U.S. Representative Mike Doyle (D-PA-18) was joined by Representative Vern Buchanan (R-FL-16) and Representative Earl Blumenauer (D-OR-03) in introducing the Energy Storage Tax Incentive and Deployment Act. This bipartisan legislation would create a stand-alone investment tax credit (ITC) for energy storage technologies for utilities, businesses and homes.

Photo courtesy of GreenBrilliance

“The Energy Storage Tax Incentive and Deployment Act would encourage the use of energy storage technologies, helping us reach our climate goals and create a more resilient and sustainable future” said Congressman Doyle. “Cost-effective energy storage is essential for adding more renewable energy to the grid and will increase the resiliency of our communities. This bill would promote greater investment and research into energy storage technologies, bolster the advanced energy economy, and create more clean energy jobs.”

Energy storage most commonly refers to batteries, but it also includes systems such as pumped hydropower, hydrogen storage (including electrolysis), thermal energy storage, regenerative fuel cells, or superconducting magnets. The wide variety of storage options gives grid operators, businesses, and homeowners flexibility in creating short, long, or even seasonal storage resources that work best for them.

“Energy storage is a critical part of the bold, comprehensive agenda that we must pursue to decarbonize our economy and address the climate emergency,” said Rep. Earl Blumenauer. “I’m glad to join Congressman Doyle in the effort to seek a once-in-a-generation opportunity to drive the growth of energy storage and take long overdue steps to save our planet.”

The Senate companion legislation was also introduced today by Senators Martin Heinrich (D – NM) and Susan Collins (R – ME) and the bill is supported by the U.S. Energy Storage Association and Citizens for Responsible Energy Solutions (CRES).

The Energy Storage Tax Incentive and Deployment Act expands the existing investment tax credit for solar energy and can apply to large, utility-scale energy storage projects or smaller battery systems for residential use. The current tax code allows an investment tax credit for energy storage when it is installed in conjunction with a solar energy system; this bill would extend the investment tax credit for energy storage investments to a wider range of applications and provide greater assurance to prospective investors.

“Without more energy storage, the United States will fail to achieve its urgent climate and clean energy goals and miss an opportunity to make power infrastructure more resilient to climate change,” said Jason Burwen, Interim CEO of the Energy Storage Association, ESA. “We urge Congress to follow the bipartisan example set today and pass this legislation to put storage on the same playing field as other clean energy technologies. If it does, we can power the economic recovery with jobs that build a cleaner, more resilient future for all.”

Click here for the text of the bill.

About The Author

Kelly Pickerel

Kelly Pickerel has over a decade of experience reporting on the U.S. solar industry and is currently editor in chief of Solar Power World.

Comments

  1. DAWUD MUHAMMAD says

    April 19, 2021 at 12:01 pm

    THE system is broken anytime the people can be WHAT THEY SAY OVER-charged $15 billion in electric rate WITH LOSTS OF LIFE due to winter climate freeze that resulted in neglect by the TEXAS UTILITIES . It’s time to replace the old electrical grid with the new modernization of the electrical distribution systems with a reliable alternative energy system design that include power storage capacity technologies.

    Reply
  2. Tom Mills says

    March 24, 2021 at 5:01 pm

    The timing of this bill is a bit overdue but not by much. As it sits now, the ITC for solar is 26%. Due to the advancement and pricing of solar panels vs battery storage and the higher cost/watt for battery storage, the ITC for batteries should be higher than that of solar. This would create a bit more paperwork but would be worth it.

    Reply
  3. Michael ONeal says

    March 15, 2021 at 4:57 pm

    Anything that reduces the death and property destruction from wildfires started by transmission lines would be a big plus. Generation and storage of energy as close to where it’s going to be used would be a big upside. The reduction in cost due to the reduction in insurance premiums to compensate those that have died or had their property destroyed would be very significant.

    Reply
  4. Richard DeMichele says

    March 14, 2021 at 12:08 pm

    I installed solar in 2020 and chose nit to install the battery backup system due to the high additional costs. If the government wants to promote battery systems with a tax refund, they should assemble the bill to include people who want to add battery storage as a supplement that already have solar and still qualify for a rebate/ tax break?

    Reply
    • Patrick Collie says

      March 15, 2021 at 8:20 am

      This bill should allow for that. If it is passed as written, you could install the new battery system in and receive the ITC on the batteries in addition to the ITC you recieved on the solar.

      Reply
  5. marco polo says

    March 12, 2021 at 3:53 pm

    GREAT news! I think storage really is the key to a more reliable energy future.

    Reply
  6. Solarman says

    March 11, 2021 at 12:59 am

    “The Energy Storage Tax Incentive and Deployment Act expands the existing investment tax credit for solar energy and can apply to large, utility-scale energy storage projects or smaller battery systems for residential use. The current tax code allows an investment tax credit for energy storage when it is installed in conjunction with a solar energy system; this bill would extend the investment tax credit for energy storage investments to a wider range of applications and provide greater assurance to prospective investors.”

    I am at this point right now. I have a grid tied dedicated system in use now. I still have more roof space on my garage for a dedicated D.C. to micro-grid, interactive ESS. While saving money for this dual system extension, it would be nice to have the ITC available to soften the costs of energy storage and smart breaker systems to allow on or off grid control of energy resources available to drive selected loads in the household.

    Reply
  7. Green Ridge Solar says

    March 10, 2021 at 3:00 pm

    This would go a long way in pushing our country to invest in solar energy storage and battery backup. We are on the cusp of an energy storage revolution, and this would be a great boost to this progress.

    Reply

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