Facilities are using Section 48E investment tax credits to make clean energy projects more affordable. A rural hospital in Colorado, for example, revised plans for a $65 million addition to include combined heat and power, geothermal, solar, and battery storage, expecting between $4 million and $8 million in credits. The credit typically offsets 30–50% of eligible heating and cooling costs, which represent roughly 17–20% of total development cost.
The credit also makes battery storage more attractive, letting buildings store cheaper nighttime electricity for use during peak-rate hours. Nonprofits and public facilities receive the benefit as a direct payment from the Treasury, while private companies can sell the credit to other taxpayers at 85–93 cents on the dollar. Small manufacturers are using batteries to run high-energy equipment during the day, cutting both demand and operating costs.
The One Big Beautiful Bill Act reduced credits for some technologies, but solar paired with storage and standalone battery systems remain eligible, and geothermal credits were left in place. Domestic content requirements apply, and some foreign-entity questions remain unresolved, though buyers are pricing in that uncertainty. A phase-out of the credits begins in 2032, and some lawmakers have introduced legislation to extend them.