U.S. Sens. Tim Scott, R-S.C., and Michael Bennet, D-Colo., are asking for clarification on the eligibility of energy storage projects for the solar investment tax credit (ITC).
In a letter to Steven Mnuchin, secretary of the U.S. Department of the Treasury, the lawmakers request that clarification be included in the Internal Revenue Service’s (IRS) 2018-2019 Priority Guidance Plan.
“As you know, the IRS previously recognized that energy storage technologies are eligible for the ITC when installed at the same time as ITC-eligible technologies, but has not explicitly affirmed whether storage technologies are eligible when added to an existing ITC-eligible technology,” they wrote.
“By making these clarifications, the IRS can ensure the full utilization of these domestic energy resources, thereby maximizing the public benefit of the tax incentive and bolstering grid reliability and energy security for the future.”
The Solar Energy Industries Association (SEIA) is applauding the letter and the potentially expanded universe of storage projects that are eligible for the solar ITC.
“In sending their letter to Secretary Mnuchin seeking the expanded and more defined eligibility for storage in the solar investment tax credit, Senators Scott and Bennet have made a strong case about the value of storage as part of our overall energy portfolio,” says Abigail Ross Hopper, president and CEO of SEIA, in a statement.
“As the senators point out, fully qualifying storage technology for the ITC will free up investment from thousands of project sponsors, bolstering grid reliability and energy security for the future,” she continues. “The opportunity to stabilize the grid through expanded solar deployment bolstered by storage cannot be lost on us as the Southeast struggles to recover from the devastating effects of Hurricane Florence and as the whole country is working to modernize the grid.
“We thank Senators Scott and Bennet for their commitment to smart electricity policy and for raising this issue with Secretary Mnuchin, and we look forward to working with the administration to ensure that storage gets added to the ITC,” Hopper says.