Senate backs BESS tax credits in $369bn plan

Senate backs BESS tax credits in $369bn plan

Senate backs BESS tax credits in $369bn plan 600 400 Batteries International

August 11, 2022: The US Senate approved draft legislation on August 7 that included an allocation of $369 billion to tackle climate change, including tax credits for investment in battery storage.

Vice-president Kamala Harris used her casting vote to break a 50:50 Senate tie to pass the Inflation Reduction Act (IRA), which must now be approved by the lower House of Representatives before being signed into law.

Heather Zichal, CEO of the American Clean Power Association, said the IRA would strengthen energy security, expand domestic manufacturing and “inject nearly half-a-trillion dollars into the US gross domestic product over the next decade”.

In a related move on August 9, the Department of Energy (DoE) outlined plans to strengthen the country’s battery materials supply chain.

Energy secretary Jennifer Granholm called on US industry, academia, research laboratories and other organizations to submit comments to help develop a new $675 million ‘Critical Materials Research, Development, Demonstration, and Commercialization Program’, which will be funded from the IRA.

The deadline for comments about the program is September 9.

Granholm also toured the Oregon facility of iron flow battery maker ESS on August 9 and said she looked forward to visiting a site where an ESS system has been deployed.

Oregon senator Jeff Merkley, who was part of Granholm’s delegation, said: “Innovative, long-duration energy storage technologies like ESS’s iron flow batteries, built here in Oregon, can play a critical role in addressing the climate crisis and decarbonizing our grid.”

The US is heavily dependent on imports for key battery materials including cobalt, lithium, manganese and nickel — according to a US Geological Survey updated list of 50 mineral commodities critical to the economy and national security published on February 22.

Battery Council International said on March 2 that lead batteries were set to underpin a new era of energy independence in the US — as the country scrambled to head-off potential shortages of critical material supplies for energy storage and electric vehicles.

BCI was responding to a “Let’s make it in America” plea by US president Joe Biden made in his State of the Union address on March 1, in which he called for an end to reliance on foreign supply chains.