The Federal Investment Tax Credit (ITC)
The Inflation Reduction Act of 2022 extended and modified the federal tax credit for clean energy. For home batteries, the key details are:
Batteries WITH Solar
If you install a battery at the same time as solar panels, or add a battery to an existing solar system, the battery qualifies for the same 30% federal tax credit as the solar.
✓ Still available through 2032 (steps down after)
Standalone Batteries (No Solar)
For batteries installed without solar—as pure backup or grid arbitrage systems—the federal credit situation is more complex. Standalone battery systems may not qualify for the residential clean energy credit.
⚠️ Consult a tax professional for your specific situation
What This Means Practically
For most homeowners considering battery storage:
- If you're adding solar anyway, adding a battery is more attractive than ever
- If you already have solar, adding a battery may still qualify (consult your tax advisor)
- If you want a battery without any solar, the economics are significantly harder
State Incentives Fill Some Gaps
Several states offer their own incentives that can make standalone batteries more viable:
- California SGIP: Significant rebates for qualifying customers, especially in fire-risk areas
- Massachusetts: ConnectedSolutions program pays for battery dispatch
- Vermont: Utility programs for battery storage
These programs have their own eligibility rules, caps, and availability windows. Check our incentive status tracker for current availability.
The Bottom Line
The "golden era" of heavily-subsidized standalone batteries may be over, but batteries paired with solar remain well-supported. State programs can still make standalone batteries work in specific situations.
Before making a decision, get actual quotes from installers and consult with a tax professional about your specific credit eligibility.
Disclaimer: This information is for educational purposes only and should not be considered tax advice. Federal tax law is complex and subject to interpretation. Consult a qualified tax professional for guidance on your specific situation.