There are indeed additional incentives available for battery storage systems at both the federal and state levels, designed to reduce costs and encourage adoption.
Federal Incentives
- Residential Clean Energy Tax Credit: Homeowners installing qualified battery storage systems with at least 3 kWh capacity can claim a federal tax credit of 30% of the system cost if placed in service between January 1, 2022, and January 1, 2033. The credit percentage decreases gradually after 2032 and applies to principal and second homes but not rentals. The credit is claimed using IRS Form 5695.
- Clean Electricity Investment Credit (CEIC): For commercial battery storage projects, the CEIC offers a tax credit starting at 6% of project costs but can increase up to 50% if the project meets certain conditions, such as using US-made materials or being located in an energy community. This credit replaced the Inflation Reduction Act incentives in 2025 and is tech-neutral, providing flexibility for various battery storage technologies.
State-Level Incentives
Many states offer rebates and performance-based incentives to supplement federal credits, which can be substantial:
| State | Incentive Program | Details |
|---|---|---|
| California | Self-Generation Incentive Program (SGIP) | Upfront rebates per kW, extra funds for high fire threat zones and low-income households. SGIP supports commercial projects and those in demand response programs, often combined with federal credits. |
| Connecticut | Energy Storage Solutions | Up to $16,000 for residential customers; 50% cost savings for businesses. |
| Massachusetts | Mass Save Connected Solutions | Financial incentives and financing solutions to reduce battery installation costs. |
| New York | Market Acceleration Bridge Incentive Program & Long Island Rebate | Up to $100–350 per kWh rebates depending on location; Long Island offers $250/kW rebates, with limited funds remaining as of 2025. |
Additional incentives benefit businesses that include battery storage in microgrid or backup power systems, particularly data centers, hospitals, and manufacturers aiming to enhance resilience and reduce operational costs.
Summary
Battery storage systems benefit from a layered incentive structure:
- Federal tax credits provide significant reductions for residential and commercial projects.
- State rebates and performance incentives offer upfront or ongoing financial support.
- Specialized programs target high-risk areas for fire or power outages, low-income households, and energy communities.
These combined incentives can substantially lower the net cost of installing battery storage systems and encourage wider adoption.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/are-there-any-additional-incentives-available-for-battery-storage-systems/
