(303) 447-0300
UPDATE: As of September 27th, 2024 there is uncertainty around the Xcel Renewable Battery Connect program. Namaste Solar is staying on top of the changes to this program. If you are interested in solar plus storage, please reach out for a quote with the most up to date information.
Publish Date: July 15th, 2024
Battery storage is a game changer for the solar industry. And right now there are rebates available to Colorado homeowners, including the Xcel battery rebate, that make storage more financially appealing than ever.
At Namaste Solar, we offer the Tesla Powerwall 3 as the battery storage option for our customers. All batteries will ensure that you’re resilient to grid outages, but the Powerwall 3 comes with improved technology, including an internal inverter, has significantly driven down the cost of adding storage.
Beyond that, there are several rebates and incentives available to Coloradans that can be stacked, bringing down the cost of battery storage even further. This includes the Xcel battery rebate and incentives from cities like Denver and Fort Collins, as well as the 30% federal tax credit.
Battery storage is the most affordable it’s ever been, and the value it offers a homeowner is unmatched. Since battery storage is the only way you can be protected from grid outages and ensure your home is truly resilient, the value of having battery storage will only increase as extreme weather events continue.
And these incentives aren’t going to last forever – in fact, some of them could be taken away at any time. So, taking advantage now is definitely in your best interest.
The Xcel Battery Rebate
Xcel is highly incentivizing battery storage right now with their program called Renewable Battery Connect. By participating in this program, you consent to allow Xcel to tap into your battery up to 60 times per year and drain up to 60% of the electricity from it. Xcel is offering this incentive as a way to add distributed battery resources that they can use to keep the grid reliable and resilient.
Xcel will not notify you when they discharge your battery and they can do it at any time. While the language in the agreement states that Xcel can charge your battery, it’s unlikely that will happen.
Here are some of the must know details about Xcel’s battery rebate program:
- The Xcel battery rebate will pay for up to 50% of the equipment costs or $500 per kilowatt of storage capacity, whichever is less.
- At Namaste Solar, we’re exclusively installing the Tesla Powerwall 3. That battery has a 13.3 kWh storage capacity. So, in this instance, the Xcel rebate will pay for 50% of the battery system costs since that’s lower than the dollar per kilowatt calculation. For most of our customers this lands them savings of $5,475 per battery.
- This rebate can be stacked. If you buy multiple batteries, you’ll save on each one. And, you can stack on incentives like the 30% federal tax credit and other state and municipal programs (more on these below).
- The exact dollar amount of savings is going to vary, especially if you go with a different installer who is selling their Powerwall 3’s at a different price than us.
- Your rebate check will come in the mail directly to you within 60 days of when your utility grants permission to operate.
- Xcel will also supply a $100 annual participation incentive as a bill credit, for 5 years.
- You can only sign up for Xcel Renewable Battery Connect when the battery is new.
- You can only sign up for the Xcel battery rebate with a battery and solar combination. This is not applicable to battery systems that aren’t connected to a solar system.
- If you’re a solar customer who’s interested in the Income Qualified & Disproportionately Impacted Communities (IQDIC) rebate from Xcel, you can’t qualify for the Renewable Battery Connect program, too. The built in inverter in the Tesla Powerwall 3 is what will disqualify IQDIC recipients from receiving the Renewable Battery Connect program.
This Xcel battery rebate is one of the biggest rebates we’ve seen offered. Xcel hasn’t given any specifics about how long this rebate will last. However, we expect that they’ll reassess the amount next year, if not sooner, and reduce how much of a rebate they offer.
Federal and State Tax Credits
The Inflation Reduction Act (IRA) extended the 30% federal tax credit through 2032. This allows homeowners who go solar to recoup 30% of their investment through a federal solar tax credit.
More good news about the IRA; it applies to battery storage, too. So, you’ll be able to get 30% of your battery system expenses applied as a tax credit the following tax season after installation.
This is a 30% credit for the total system cost after any utility rebates are subtracted from that total system cost.
The state of Colorado is also offering a 10% tax credit on battery hardware only. This state tax credit is unaffected by any utility rebates. You would file for this when you file your taxes during the tax season after installation, much like the federal tax credit.
Battery Incentives for City of Denver Residents
Denver’s rebate is called the Denver Climate Action rebate. Only residents of the city of Denver qualify for this rebate. And the incentive is significantly higher if you have a heat pump. There are multiple types of heat pumps that qualify. The incentives are as follows:
- If the home has a heat pump space heater (HPSH), heat pump water heater (HPWH), or vehicle-to-building electric vehicle charger (V2B EV):
- Rebate maximum is $2,750
- Rebates cannot exceed 80% of the total cost
- All other homes:
- Rebate maximum is $500
- Rebates cannot exceed 80% of the total cost
The city of Denver does not require battery storage to be hooked up to solar. However, since Xcel does require this, it’s unlikely that you’ll be able to stack these rebates without solar.
Battery Incentives for Fort Collins Utility Customers
Fort Collins Utility is the only other utility that’s currently offering solar and battery incentives. These incentives are good from August 1st, 2024 through November 30th, 2024.
The rebate on solar is $200/kW-DC, up to $1,000. The rebate on battery storage is $150/kwh capacity, up to $3,000.
The minimum equipment size to be eligible is 500 Watts-DC for Solar PV and 6 kWh for Battery.
Namaste Solar is one of Fort Collins' approved contractors that customers must use to qualify for a rebate. We'll handle everything and will submit the application on your behalf. Learn more here.
So, Is Battery Storage Really Worth It?
It wasn’t too long ago that the payback period for battery storage was nonexistent. But now, with the equipment cost plummeting due to advanced technology and all these rebates stacked, battery storage is extremely affordable.
Plus, the value of having a resilient home that’s powered by clean energy and will stay up and running during a grid outage cannot be overstated. As extreme weather events due to climate change increase in frequency and intensity, increasing your home’s resiliency is a valuable investment. One that some customers can pay as little as $2,000 extra for.
We know that the numbers we’ve shared with you, like the Xcel battery rebate, are exciting but likely overwhelming to navigate. Our non-commissioned sales advisors are experts at stacking rebates to save you the highest amount possible. We’ve worked exclusively in the Colorado market since 2005 – we know the ins and outs of Colorado solar and navigating the many utilities in our area. And since our team is non-commissioned, they’re invested in telling you the truth and not just giving you a sales pitch. Click the button below to get started.
