Provisions that support clean energy, energy storage included in $900 billion relief bill

The $900 billion COVID-19 relief package approved in Congress this week includes provisions supporting solar, wind, energy storage, and energy efficiency.

Specifically, the omnibus legislation includes a one-year extension of the production tax credit/investment tax credit for land-based wind at 60 percent of their full value and a 30 percent offshore wind investment tax credit for projects that commence construction from Jan. 1, 2017, through Dec. 31, 2025.

“We appreciate that Congress has recognized clean energy’s significant contributions to our nation’s economy and role in providing jobs and investments during the recovery from the COVID-19 pandemic. As we enter the new year, stable policy support will help ensure that wind and solar can continue providing the backbone of our country’s electricity growth. We also applaud Congress for recognizing the enormous potential of offshore wind, America’s largest untapped electricity source, as a brand-new provider of jobs for American workers and clean power for American families,” Heather Zichal, CEO of the American Clean Power Association, said.

The bill also features a two-year extension of the solar Investment Tax Credit (ITC). The tax credit will remain at 26 percent for projects that begin construction in 2021 and 2022, drop to 22 percent in 2023, and 10 percent in 2024 for commercial projects while the residential credit ends completely.

“We are heartened to see Congress step up to provide Americans with some relief after our country has been mired in a public health and economic disaster. This pandemic has taken an immeasurable toll on American families, and our deepest sympathies are with those who have lost loved ones and those who are suffering economically because of the ongoing crisis,” Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association, said. “Over the next few years, we have an opportunity to build a stronger, more reliable, and more equitable American energy economy and the action Congress is taking today is a helpful down payment.”

In addition, the omnibus package sets aside more than $1 billion over 5 years for investments in energy storage technology research, development, and demonstration (RD&D) and includes the Better Energy Storage Technology (BEST) Act.

“The inclusion of the Better Energy Storage Technology (BEST) Act as part of the year-end spending and relief package is further proof of the bipartisan, bicameral support for energy storage to improve grid reliability and flexibility,” U.S. Energy Storage Association CEO Kelly Speakes-Backman said. “Congress has recognized the critical role of energy storage in building a clean energy future.”

Further, the bill features several key provisions for advancing energy efficiency, including a permanent extension of the Sec. 179D tax deduction for energy-efficient commercial buildings, funding increases for initiatives such as ENERGY STAR and the Building Technologies Office, and provisions for reducing energy waste in the federal government, accelerating smart building technology, encouraging waste-heat to power, and strengthening the Weatherization Assistance Program.

“This bill is a good step forward. There are many things to like in the package,” Alliance to Save Energy Interim President Clay Nesler said. “Making the commercial buildings efficiency tax incentive permanent will particularly go a long way toward giving the markets the certainty needed to encourage more efficiency projects, which will create thousands of jobs and sharply reduce greenhouse gas emissions.”