April 7, 2021
Treasury Dept. Report Finds ITC for Storage would Spur Clean Energy Production, Build More Resilient Grid
Investment Tax Credit Creates Opportunity for Jobs and a Resilient, Clean Electric Grid
WASHINGTON, D.C.—A report by the U.S. Treasury Department examining the President’s Made in America Plan today found that making standalone storage eligible for the Investment Tax Credit (ITC) would result in greater clean energy production and a more resilient grid.
“The Treasury Department’s report confirms that making standalone storage eligible for the ITC—just as other clean energy technologies are today—is critical for the United States to achieve its urgent climate and clean energy goals and build a more resilient grid,” said Jason Burwen, Interim CEO of ESA. “We continue to urge Congress to pass bipartisan legislation that would achieve this goal and power the economic recovery by creating jobs that build a cleaner, more resilient future for all.”
The Made in America Tax Plan states that enabling a standalone storage ITC “would advance clean electricity production by providing a ten-year extension of the production tax credit and investment tax credit for clean energy generation and storage, and making those credits direct pay. Together with non-tax initiatives, like the Energy Efficiency and Clean Electricity Standard, the plan sets the country on a path to 100 percent carbon pollution free electricity by 2035,” the report finds. “The plan further expands the tax incentives available for electricity storage projects. These incentives would help ensure that the electricity supply is reliable as well as less harmful to the climate.”
During the first quarter of 2021, momentum for the ITC for storage has grown. Last week, the president released his American Jobs Plan which also included the ITC for storage tax credit, along with reviving the 48C manufacturing tax credit and targeted grants. More than 150 organizations sent a letter to U.S. House and Senate leaders requesting they include bipartisan legislation that would make standalone storage projects eligible for the ITC in the upcoming infrastructure bill.
In March, Sen. Martin Heinrich (D-N.M.), Sen. Susan Collins (R-Maine), Rep. Earl Blumenauer (D-Ore.), Rep. Mike Doyle (D-Pa.) and Rep. Vern Buchanan (R-Fla.) introduced the Energy Storage Tax Incentive and Deployment Act (S. 627 / H.R. 1684) to remove limits on applying the tax credit to storage technologies only when integrated with ITC-eligible solar projects. This legislation is mirrored in the recently introduced GREEN Act (H.R. 848), which includes the option for a direct payment of the ITC in addition to making storage technologies eligible for it.
As outlined in ESA’s 2030 Vision, at least 100 GW of new energy storage is needed to drive the clean energy transition and transform the electric system to handle 21st century demands. The United States has deployed over 3 GW of battery and other advanced energy storage to date.
About The U.S. Energy Storage Association:
The U.S. Energy Storage Association (ESA) is the national trade association dedicated to energy storage, working toward a more resilient, efficient, sustainable and affordable electricity grid – as is uniquely enabled by energy storage. With more than 200 members, ESA represents a diverse group of companies, including independent power producers, electric utilities, energy service companies, financiers, insurers, law firms, installers, manufacturers, component suppliers and integrators involved in deploying energy storage systems around the globe. More information is available at: www.energystorage.org.