If you’re a commercial property owner or industrial operator, now is the time to act.
The Investment Tax Credit (ITC)—which allows you to deduct up to 30% of your solar and battery storage project costs from your federal tax bill—is phasing out rapidly. New legislation passed in July 2025 sets hard deadlines, and missing them could cost your business hundreds of thousands in lost incentives.
Pacifico Energy, helps large energy users navigate this complex landscape—so you can move quickly, stay compliant, and maximize your ROI.
✅ What Is the ITC?
The Investment Tax Credit, established under Section 48 of the Internal Revenue Code, covers:
- Up to 30% of the cost of installing solar and battery storage systems.
- Includes engineering, permitting, equipment, and labor.
- Bonus incentives for using domestic content and locating in energy or low-income communities.
Since 2006, the ITC has driven a 10,000% increase in solar installations, saving U.S. businesses billions. Battery storage, added under the 2022 Inflation Reduction Act, now qualifies independently or as a co-located system.
🕒 New Timeline: The Clock Is Ticking
Under the “One Big Beautiful Bill” (signed July 4, 2025), the ITC begins phasing out for solar and wind projects starting January 1, 2026.
Here’s the New Breakdown:
| Construction Start Date | ITC Credit | Requirements |
|---|---|---|
| By Dec. 31, 2025 | 30% | Must meet IRS “begun construction” criteria |
| By July 4, 2026 | 18% | Project must be in service by Dec. 31, 2027 |
| By Dec. 31, 2027 | 6% | Same service deadline |
| After Jan. 1, 2028 | 0% | No ITC available for solar or co-located storage |
⚠️ Key Point: If you begin construction after December 31, 2025, your tax credit shrinks dramatically—from $300,000 to just $60,000 on a $1M project.
📋 How to Qualify: ITC Eligibility Checklist
To lock in the full 30% credit, your project must “begin construction” in 2025 under IRS guidelines.
✔ You must do ONE of the following:
- Physical Work Test
- Start significant work on-site (e.g., racking, trenching, pouring foundations).
- OR begin off-site work on key components (e.g., transformers, switchgear).
- 5% Safe Harbor
- Incur at least 5% of total project costs (e.g., place an equipment order or deposit).
- Document expenses clearly and maintain “continuous progress.”
🛠 Either method locks in the 30% credit—as long as the project is placed in service by December 31, 2027.
🚧 New Rules: Compliance Just Got Harder
🛑 FEOC Rules (Foreign Entity of Concern)
Projects cannot use solar panels, inverters, or batteries made by flagged countries or companies. This limits sourcing options and increases lead time.
🇺🇸 Domestic Content Bonus
Want an extra 10% credit (for a total of 40%)? You’ll need:
- At least 45% U.S.-made steel, iron, and manufactured components.
- Requirement rises annually, starting June 16, 2025.
We help ensure your system qualifies—without jeopardizing timelines or cost.
💡 Why Act Now?
Delaying your decision past 2025 risks:
- Losing up to $240,000 in tax credits (on a $1M system).
- Higher utility rates and peak demand charges.
- Long interconnection and permitting waitlists.
- Supply chain bottlenecks that could make you miss the deadline.
🧭 How Pacifico Energy Helps
Pacifico Energy specializes in commercial and industrial-scale clean energy projects, with a proven track record.
- ⚡ Fast-tracked Design & Permitting
- 🔍 Compliance with FEOC and Domestic Content
- 💵 No-CAPEX Solutions via Energy-as-a-Service
- 📑 Power Purchase Agreements (PPAs) & Tax Equity Structuring
- 🔋 Solar + Storage Engineering
📞 Final Call: Lock in the 30% Credit Before It’s Gone
You have just a few months to make a move that could lock in massive savings for the next 20+ years.
Pacifico Energy is here to help—from consultation to commissioning.
