WASHINGTON – Today, U.S. Senators Martin Heinrich (D-N.M.) and Susan Collins (R-Maine) introduced the bipartisan Energy Storage Tax Incentive and Deployment Act to establish an investment tax credit (ITC) for business and home use of energy storage.
The bipartisan bill modifies the existing investment tax credits (ITC) for solar energy to include a modest ITC for deployment of energy storage. The storage ITC mirrors the existing ITCs for solar energy in both commercial and residential applications. There is currently no separate ITC available for energy storage systems.
“Innovative energy storage technologies can improve the efficiency, reliability and resilience of our electric delivery systems that power homes and businesses. Over the last few years, storage technology has dramatically reduced costs while increasing our ability to manage grid supply and demand,” said Heinrich. “The deployment of energy storage needs to be at the center of our ongoing effort to move toward a cleaner and more reliable electrical grid. This bipartisan bill will make it easier and more affordable to utilize energy storage technologies that will strengthen the renewable energy sector and support the thousands of clean energy jobs in New Mexico.”
“Energy storage technology holds great promise in the fight against climate change. Supporting current technology and advancing next-generation energy storage will allow us to integrate more renewables, and in turn, will help to reduce emissions,” said Collins. “Last year, the BEST Act I authored with Senator Heinrich to advance energy storage technology was signed into law, and this bipartisan bill would build on that successful effort by establishing an investment tax credit for energy storage.”
Energy storage complements intermittent renewable resources, such as wind and solar to increase full-time availability, provide backup power in case of emergencies, and help reduce the need for high-cost power during periods of peak demand.
The proposed tax incentives are modeled on the current ITCs for solar energy and apply to either large, grid-connected energy storage systems or to smaller battery systems for residential power. Home battery storage, coupled with a small wind or roof-top solar system, could be used to store energy during the day for use later in the day or during overcast skies and to help consumers reduce their energy bills.
In December 2020, bipartisan legislation introduced by Senators Heinrich and Collins and U.S. Senator Tina Smith (D-Minn.) to accelerate the development of next-generation energy storage was signed into law. The Better Energy Storage Technology (BEST) Act supports grid-scale energy storage research and development and improves the efficiency of the nation’s electric grid, while helping to align research efforts on energy storage technologies.
In addition to Senators Heinrich and Collins, the Energy Storage Tax Incentive and Deployment Act is co-sponsored by U.S. Senators Brian Schatz (D-Hawai’i), Michael Bennet (D-Colo.), Sheldon Whitehouse (D-R.I.), Mazie Hirono (D-Hawai’i), Tina Smith (D-Minn.), Jack Reed (D-R.I.), Cory Booker (D-N.J.), Dianne Feinstein (D-Calif.), Chris Van Hollen (D-Md.), and Angus King (I-Maine). U.S. Representatives Mike Doyle (D-Penn.), Earl Blumenauer (D-Ore.), and Vern Buchanan (R-Fl.) introduced the House companion.
“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. 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," said Doyle.
“New technology like large-scale battery storage, is a critical step on the path to a cleaner and more efficient energy future,” said Buchanan. “Investing in alternative energy sources has the added benefit of creating thousands of new jobs in Southwest Florida and across the country.”
"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 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 bipartisan Energy Storage Tax Incentive and Deployment Act is supported by the U.S. Energy Storage Association and Citizens for Responsible Energy Solutions (CRES).
“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 U.S. Energy Storage Association. “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.”
“Expanding investment tax credits (ITC) for energy storage is a pro-growth, no-brainer policy that will support any power generation connected to the grid—wind, solar, hydro, nuclear, gas, coal—to become more efficient, productive and competitive. Federal tax incentives will spur significant private sector investments in energy storage, putting the full power of American innovation towards building our next-generation energy infrastructure for the future. I applaud the bi-partisan leadership of Senators Susan Collins (R-ME) and Martin Heinrich (D-NM) for working to give businesses and homeowners the ability to invest in game-changing energy storage solutions in a cost-effective manner. Resilient, reliable energy storage is critical to building a clean energy economy and will create good-paying American jobs," said Heather Reams, Executive Director of Citizens for Responsible Energy Solutions (CRES).
Read the full text of the bill by clicking here.