Alliance of California energy storage companies call on Congress to create storage investment tax credit

As Congress continues debates over infrastructure needs, the California Energy Storage Alliance (CESA) and more than 50 California energy storage companies wrote lawmakers in a plea for a new storage investment tax credit to be included in any future legislation.

“As you consider clean energy and infrastructure legislation, we urge you to support an Investment Tax Credit (“ITC”) for energy storage technologies,” the signatories wrote. “Enacting a storage ITC this year is critical to ensure a level playing field for energy storage to compete with all other energy resources made eligible for the ITC (such as solar, microturbines, and fuel cells), while also enabling the grid enhancements that energy storage can provide. Energy storage helps generation resources become more efficient, productive, and competitive.”

Earlier this year, President Joe Biden’s American Jobs Plan called for energy storage to gain its own ITC. Multiple legislative efforts have since followed, with the measure included, though none have yet become law. With that uncertainty looming, the California companies notified Congress that such an ITC would provide California residents a more resilient, reliable, and cost-effective electric system through the encouragement of energy storage.

Further, CESA estimated that energy storage development has thus far created more than 18,000 jobs in California between 2010 and 2020. CESA expects this figure to balloon to more than 98,000 jobs by 2030, meaning there are economic considerations here as well.

“Storage solutions are increasingly helping California customers manage their energy bills while also providing backup power during the recent, more frequent outages,” the companies wrote. “Storage also supports our state and national clean energy and greenhouse gas emission reduction goals by absorbing and later discharging energy from renewables, providing critical balancing for the grid. Storage does this when configured to ‘stand-alone’ or when ‘co-located’ with renewable power sources. As renewables come online, storage supports grid needs such as ramping and voltage support and reduces the need to rely on high emission power sources.