The Solar Investment Tax Credit (ITC) rate timeline has been extended after the President approved the $900 Billion COVID-19 Virus relief package, which passed just before the new year of 2021, along with a $1.4 trillion federal spending package.
This means in part that all solar projects, including residential, commercial, and utility-scale, are eligible for the 26% tax credit for installations starting in 2021 and 2022. In 2023, the ITC will decrease to 22%, and in 2024, it will reduce to 0% for residential projects and 10% permanently for commercial and utility-scale projects.
Energy Storage Under the ITC
While the stimulus package does not involve clear language on subsidies for batteries, the solar ITC can still be applied to batteries if being charged only by renewable energy for residential systems. For commercial systems, 75% of the stored energy must be from renewable resources (i.e., solar and wind).
The relief package also includes the Better Energy Storage Technology Act, which consists of a 5-year spending schedule for $1.08 billion on energy storage research and development and a $2.36 billion spending plan for smart-grid technologies (2 & 3).
The energy storage research and development will focus on developing:
“(A) energy storage systems that can store energy and deliver stored energy for a minimum of 6 hours in duration to balance electricity needs over the course of a single day”
“(B) long-duration energy storage systems that can store energy and deliver stored energy for 10 to 100 hours in duration; and”
“(C) energy storage systems that can store energy and deliver stored energy over several months and address seasonal scale variations in supply and demand”
Take advantage of the 26%
In essence, research & development seeks to build new and more efficient ways of reaching longer feats of autonomy from energy storage at varying operation scales.
If you need help getting started, you can watch our video tutorial on using the Solar Kit Guide or contact the Renvu sales team at firstname.lastname@example.org.