Tax credits

[janfreiwald]

I have heard there will be federal tax credits for battery storage. When do tax credits become available for installing battery storage? Are there other incentives than federal tax credits in California? If so, what what do I have to do to qualify?

 

[SolarPro415]

The Residential Clean Energy Credit provides a 30% reimbursement of the expenses associated with new, qualified clean energy property installed in your home anytime from 2022 through 2032. The credit rate gradually decreases to 26% for property in service in 2033 and further to 22% for property in service in 2034. Eligibility for the credit is contingent on making energy-saving enhancements to your home.

This nonrefundable credit means that the credited amount cannot exceed your tax liability. However, any surplus credit can be carried forward to offset future tax obligations. Any interest paid, including loan origination fees, cannot be included.

Except for fuel cell property, there are no annual or lifetime dollar limits on the credit. You are eligible to claim the credit each year you install qualifying property until it begins to phase out in 2033.

Qualified expenses include the costs of new clean energy property including:

• Solar electric panels
• Solar water heaters
• Wind turbines
• Geothermal heat pumps
• Fuel cells
• Battery storage technology (beginning in 2023)

Used (previously owned) clean energy property is not eligible.

Here is a good link on the IRS website with forms and details: Residential Clean Energy Credit

 

[janfreiwald]

Thank you! that is really great information.
Anyone know about California tax credits or incentives?

 

[Bruce Thompson]

Thank you! that is really great information.
Anyone know about California tax credits or incentives?

CA SGIP program has rebates for energy storage in CA. I think some CCAs in CA are also looking into offering storage rebates. Fyi - the SGIP program is quite confusing to navigate and the amount/availability of the rebate depends on a number of criteria such as income thresholds, high fire district, PSPS events, etc. I recommend having a solar installer look this up for you. Most solar installers are registered with the CA SGIP program to apply on their customers behalf.

 

[SolarPro415]

If you live in a CA community with a CCA, there might local storage incentives available too. Here are details on a few of them:

San Diego Community Power's Solar Battery Savings Program
San Diego Community Power (SDCP) serves about 1 million customers across San Diego County. Launched in July, the Solar Battery Savings Program offers single-family homeowners upfront rebates for batteries paired with new or existing solar systems, plus ongoing payments for energy discharged according to program rules. Low-income participants receive additional incentives for solar systems. With a budget exceeding $11 million, the program provides rebates of up to $500/kWh for eligible customers, and performance incentives of $0.10/kWh for discharged energy. Batteries must be used for five years and adhere to specific discharge hours. Approved contractors and pre-approved batteries are listed on the program's website.

3CE’s Residential Battery Rebate Program
Central Coast Community Energy (3CE), covering Monterey to Santa Cruz Counties, recently launched a Residential Battery Rebate Program. This initiative provides upfront rebates of $300 or $500 per kWh, which can be combined with other incentives. The program targets single-family and some multifamily units, requiring batteries to be installed after January 1, 2024, with a minimum capacity of 5 kWh. Batteries must discharge at least 50% daily during peak hours and be enrolled in load-shifting software. 3CE plans to support 400 systems annually with a $2 million budget.

Clean Power Alliance Sun Storage Rebate Program
The Clean Power Alliance, serving Los Angeles and Ventura Counties, offers the Sun Storage Rebate Program, providing $750 or $1,000 for CARE, FERA, and Medical Baseline customers who install eligible solar battery systems. More details are available on their program website.