What is the tax rate for the new energy supporting energy storage service fee

What is the investment tax credit for standalone energy storage?

Image: Eolian The investment tax credit (ITC) for standalone energy storage is an undoubted game changer for the US industry, but it isn’t easy or cheap to capture its benefits. The ITC came into effect at the beginning of this year, offering upwards of a 24% reduction in the capital cost of investing in eligible energy storage project equipment.

Does eolian have an investment tax credit for standalone energy storage?

Eolian made the first use of tax equity financing to get the ITC for standalone BESS projects in February. Image: Eolian The investment tax credit (ITC) for standalone energy storage is an undoubted game changer for the US industry, but it isn’t easy or cheap to capture its benefits.

Do energy storage projects qualify for a bonus rate?

Energy storage projects (i) not in service prior to Jan. 1, 2022, and (ii) on which construction begins prior to Jan. 29, 2023 (60 days after the IRS issued Notice 2022-61), qualify for the bonus rate regardless of compliance with the prevailing wage and apprenticeship requirements.

What is the ITC rate for energy storage projects?

Energy storage installations that begin construction after Dec. 31, 2024, will be entitled to credits under the technology-neutral ITC under new Section 48E (discussed below). The base ITC rate for energy storage projects is 6% and the bonus rate is 30%.

Do energy storage projects qualify for a new ITC?

Energy storage projects placed in service after Dec. 31, 2022, that satisfy a new domestic content requirement will be entitled to a 10% additional ITC (2% for base credit).

Will the inflation Reduction Act affect energy storage projects?

Image: President Biden via Twitter. The Inflation Reduction Act’s incentives for energy storage projects in the US came into effect on 1 January 2023. Standout among those measures is the availability of an investment tax credit (ITC) for investment in renewable energy projects being extended to include standalone energy storage facilities.