Solar Safe-Harboring: How PowerFlex Can Still Help You Claim the Investment Tax Credit Through 2030

The One Big Beautiful Bill Act changed the timeline for commercial solar incentives — and for many organizations, the window to act appeared to close on July 4, 2026. But for companies that partner with the right developer, the Investment Tax Credit (ITC) remains within reach. Here is what commercial enterprises need to know about the ITC, why the standard paths to eligibility are no longer viable for new projects, and how PowerFlex’s safe-harboring strategy provides the only remaining route to securing this valuable federal incentive.

What Is the Investment Tax Credit for Solar?

The Investment Tax Credit is a dollar-for-dollar federal tax reduction equal to a percentage of qualified costs associated with a commercial solar installation. Those qualified costs include the solar panels themselves, inverters, wiring, and installation.

Commercial systems less than 1 megawatt (MW) may be entitled to a 30% tax credit under the ITC. Projects 1 MW or larger can qualify for the full 30% credit only if certain conditions are met, such as offering prevailing wage for labor during construction. Otherwise, the credit drops to 6%.

Some installations — particularly those sited in low-income communities — may qualify for additional credit on top of the base rate.

The financial impact is substantial. For a mid-to-large-scale commercial solar project, the ITC can translate to tens, if not hundreds, of thousands of dollars in tax savings. For many organizations, this single incentive is what tips the financial calculus in favor of going solar.

Is the Investment Tax Credit Still Available?

Yes, but the path to claiming it has narrowed significantly.

The One Big Beautiful Bill Act (OBBBA) accelerated the phase-out of the ITC for solar. Systems that commenced construction before July 4, 2026, must be placed into service by the end of 2030 to receive the credit.

Now that the deadline has passed, companies considering a new solar installation today have only until December 31, 2027, to make their system operational and retain ITC eligibility, which is all but impossible. Solar projects of meaningful commercial scale require site assessment, engineering, permitting, procurement, and construction — a process that typically extends well beyond 18 months.

In short, both ITC pathways are effectively closed for new solar projects. The good news is that PowerFlex has planned for this exact scenario and can help companies still qualify for the ITC through a strategy called safe-harboring.

PowerFlex’s Safe-Harboring Strategy Preserves ITC Value

Safe-harboring is not a loophole. It’s a well-established IRS mechanism that allows a project to meet “start of construction” requirements through the procurement of qualifying equipment, even before that equipment is assigned to a specific site or customer.

PowerFlex acted well before the July 4 deadline, investing in significant quantities of solar modules, transformers, and other equipment to establish start-of-construction status for future projects.

This is the critical distinction. The safe-harbor status applies to the equipment and the developer’s advance activity, not to the customer’s timeline. When a commercial enterprise partners with PowerFlex, its project inherits the ITC eligibility that PowerFlex secured through proactive procurement.

Two Methods, One Big Advantage

The IRS recognizes two safe-harboring methods:

• The 5% Purchase Method requires procurement of at least 5% of total project cost in qualifying equipment before July 4. This method can be used for projects of any size due to the timing of PowerFlex’s exercised safe-harboring strategy.
• The Physical Work Method requires either significant onsite construction or offsite physical activity (such as transformer manufacturing or assembly) under a binding contract.

PowerFlex has executed both safe-harboring methods across its portfolio, providing customers a viable path to claiming the ITC post-July 4.

Why Most Other Providers Fall Short

Not every solar solutions provider has the resources to safe-harbor at scale. Smaller developers, particularly those without institutional backing, typically rely on customer capital to fund equipment procurement. If a customer did not move quickly enough before July 4, those developers have no safe-harbored inventory to offer.

PowerFlex’s scale, backed by EDF power solutions and Manulife, has enabled the company to make proactive investments in equipment and construction activity ahead of the deadline. That foresight is what separates solar solutions providers that can still deliver ITC-eligible projects from those that cannot.

Secure the ITC Before the Window Closes

Projects using PowerFlex’s safe-harbored equipment must still be placed in service by the end of 2030. That timeline is workable for most commercial solar installations, but it’s not unlimited. It’s critical for organizations to engage a provider as soon as possible, complete a site evaluation, and move into system permitting, design, and construction.

Beyond safe-harboring, PowerFlex also helps organizations secure the valuable 10% domestic content ITC adder and navigate Foreign Entity of Concern (FEOC) compliance requirements, ensuring that equipment sourcing meets IRS material-level standards and that the full credit value is protected.

Ready to get started? Contact a PowerFlex expert right now to secure your ITC eligibility.