A new era for clean energy in the U.S.
The Inflation Reduction Act (IRA) of 2022 marks a turning point for clean energy in the United States, providing robust support for renewable energy projects, including energy storage systems. By introducing tax incentives and simplifying access to the Investment Tax Credit (ITC), the IRA is making it more economically viable for businesses to adopt energy storage. For Pixii, a company with a proven track record in energy storage solutions, this presents a unique opportunity to bring our expertise to the American market. Here’s how the IRA benefits energy storage projects and how Pixii is positioned to help businesses make the most of these opportunities.
The impact of the IRA on energy storage
The IRA has made significant changes to the tax landscape for energy storage projects, with three key provisions driving interest in battery energy storage systems (BESS):
- Standalone ITC for energy storage: Before the IRA, the ITC was available only for energy storage systems that were installed alongside solar projects. Now, energy storage systems with a minimum capacity of 5 kWh can qualify for a standalone ITC, making it possible to install and benefit from battery storage independently of solar installations. This opens up new possibilities for businesses looking to manage energy costs and enhance resilience without necessarily needing a solar array.
- Increased ITC rates: Energy storage projects are now eligible for a base ITC of 30%. This can significantly reduce the upfront cost of energy storage systems, making it easier for businesses to invest in solutions like Pixii’s BESS.
- Extended timeframes and new 48E ITC: The IRA extends the availability of the ITC through new Section 48E, ensuring that projects that begin construction before 2033 can benefit from these incentives. This long-term stability is critical for planning larger projects and aligns well with Pixii’s long-term vision for expanding energy storage adoption in the U.S.
How Pixii’s solutions align with IRA incentives
Pixii’s battery energy storage systems are designed to help businesses take full advantage of the IRA’s incentives. Here’s how:
- Flexible installation options: With the new ITC for standalone storage, Pixii’s BESS can be deployed in various configurations – whether as part of a new energy storage project or as an upgrade to existing infrastructure. This flexibility allows businesses to optimize their energy use and leverage the 30% ITC without needing a complete system overhaul.
- Supporting compliance with labor requirements: To qualify for the bonus ITC rate, projects must meet prevailing wage and apprenticeship standards. Pixii’s commitment to high-quality, reliable installations means that our partners can feel confident in meeting these requirements, ensuring that they maximize their ITC benefits.
- Ideal for energy arbitrage and demand management: Pixii’s technology enables businesses to capitalize on time-of-use rates and reduce demand charges. These strategies are particularly relevant in states like California, New York, and Massachusetts, where time-sensitive pricing is common and where IRA incentives make battery storage more appealing.
The broader benefits: Domestic manufacturing and economic growth
The IRA also supports local economies through incentives like the 10% bonus ITC for using domestically produced components and additional credits for projects located in energy communities. Pixii’s focus on high-quality, adaptable systems aligns with these goals, making us a strong partner for businesses looking to contribute to local economic growth while benefiting from advanced energy storage solutions.
- Domestic content bonus: Projects that use components made in the U.S. can benefit from a 10% ITC adder. This aligns with Pixii’s focus on quality and reliability, ensuring that our systems not only perform but also support local manufacturing goals.
- Focus on energy communities: The IRA provides additional incentives for projects in energy communities, such as areas affected by coal mine closures. This presents an opportunity for businesses to invest in regions where they can make a significant social and economic impact while also securing higher ITC rates.
Why now? The time is right for energy storage in the U.S.
With the IRA’s incentives and Pixii’s advanced energy storage solutions, now is the ideal time for businesses in the US to invest in battery storage. By reducing upfront costs and providing stable, long-term incentives, the IRA has created a window of opportunity that can help businesses cut energy costs, improve resilience, and even generate new revenue streams through participation in grid services.
2024 to 2034 – expected growth in the energy storage market for the U.S
These incentives, combined with state programs like California’s Self-Generation Incentive Program (SGIP), create an environment where energy storage investments can quickly pay off, especially when combined with Pixii’s technology. Pixii’s BESS solutions are well-positioned to take advantage of these incentives, making it easier for businesses to transition to sustainable and cost-effective energy management.
Conclusion: Empowering U.S. businesses with Pixii’s expertise
Pixii’s BESS technology empowers C&I customers across the U.S. to reduce costs, enhance energy resilience, and capitalize on new revenue streams. Whether through OEM partnerships or direct solutions, Pixii is committed to delivering high-value, flexible energy storage solutions that adapt to the unique needs of the American market.
With the added support of the IRA’s incentives, Pixii is poised to help businesses unlock the full potential of energy storage, driving both economic and environmental benefits.