Washington, D.C. – (RealEstateRama) — Renewable energy allows American families and businesses to generate their own clean energy, and advances in energy storage will allow our nation to better harness this energy. However, one critical tax law may slow that process down.
That is why U.S. Rep. Mike Honda (D-Silicon Valley, Calif.) was joined by a dozen of his colleagues, in a letter calling on Treasury Secretary Jack Lew and IRS Commissioner John Koskinen to allow those storage innovations the same tax credit that is available for clean energy generation.
“We believe that including storage devices … is an important step in securing our nation’s energy future,” the letter reads in part. “Providing guidance that is inclusive of energy storage will allow for the nationwide adoption of these technologies in new and broader applications while enabling consumers to take full advantage of the benefits provided by the ITC.”
The IRS is working on new guidance to accompany Section 48 of the tax code, which provides a 30 percent tax credit for qualifying renewable energy systems on commercial properties, commonly known as the Investment Tax Credit (ITC).
“Energy storage technologies are a key element of creating the energy grid of the future,” said Tim McRae, Senior Director of Energy at the Silicon Valley Leadership Group. “Integration of these technologies will support a smarter, more reliable grid and enable the development of a new energy market structure.”
Allowing energy storage to take full advantage of the ITC is also supported by several major technology groups in the Silicon Valley, including Tesla Motors, Inc., Stem Inc., Green Charge Networks, Energy Storage Association, Silicon Valley Leadership Group and Imergy Power Systems.
“Stem strongly supports the commitment shown by Congress to expand the U.S. energy storage industry,” said John Carrington, CEO of Stem. “Including energy storage under the ITC would also enable enormous economic development in the U.S., creating countless jobs and new financial opportunities from coast to coast.”
The letter also notes that alternative energy is only one use for energy storage. Energy storage also has great potential to broadly impact both the energy and transportation sectors.
“Energy storage improves the efficiency of the grid and provides synergy with solar generation and other renewables, “said Vic Shao CEO of Green Charge Networks. “Distributed energy storage is driving innovation and transforming U.S. energy markets and is one of the fastest-growing markets in the renewable energy sector. Broadening the ITC definition will drastically speed up market adoption.”
Storage devices have the capability to store large amounts of electricity, are deployable at any location in the country, and can not only work in concert with any form of energy generation, but can be designed specifically to provide benefits to the grid.
“Energy storage opens the path to a future of reliable, affordable, and clean electricity for all Americans,” said Matt Roberts, Executive Director of the Energy Storage Association. “These Representatives understand that policy has yet to catch up with technology, and we thank them for supporting greater clarity and simplicity in how IRS rules apply to energy storage. Doing so will give business owners and customers for energy storage the certainty the need to make smart market decisions.”
The letter to Koskinen and Lew was signed by Reps. Lofgren, Pocan, Castor, Langevin, Tonko, Cartwright, Grijalva, Hastings, Schiff, Takai, Ellison and Takano.