This act adds new sections to chapter 82.16 RCW to create a state‑approved program that incentivizes grid‑connected residential battery energy storage systems and to establish a related tax credit for qualifying light and power businesses. Large utilities (those with more than 100,000 retail electric customers in Washington) must implement an approved battery incentive program; smaller utilities may opt in. Utility programs must provide an incentive payment, include either retail time‑of‑use rates or incorporation of customer batteries into a utility‑operated virtual power plant, and dedicate at least 40 percent of program benefits to low‑income and moderate‑income households, low‑income service providers, housing authorities, or tribal governments. Leases to customers are prohibited and utilities may set installer partners and equipment specifications; WSU extension energy program must approve programs and audit them at least biennially and the Department of Commerce must publish nonbinding virtual power plant recommendations by December 1, 2025. The act sets payment and tax‑credit rules and limits. Incentive payments are capped at 18 kilowatt‑hours per customer, with maximum incentive amounts up to $765 per kilowatt‑hour for low‑ and moderate‑income qualified customers and up to $450 per kilowatt‑hour for other customers, payable only for systems certified between July 1, 2026, and June 30, 2036. A new tax credit allows qualified light and power businesses to claim credits equal to incentive payments and certain program expenses and upgrades (expense credits limited to 20 percent of the total credit). The tax credit for incentive payments is limited to 1.5 percent of the business’s taxable Washington power sales in calendar year 2022, credits cannot exceed tax liability or be refunded (unused credits may be carried forward), tax credits may be earned beginning July 1, 2026, may not be earned after June 30, 2036, may not be claimed after June 30, 2038, and the tax‑credit section expires June 30, 2040. The act also makes procedural and enforcement changes: if an incentive was overpaid the utility may recover the excess and must assess interest on the recovery as prescribed for delinquent tax; if a business claimed excess tax credits the department may require immediate repayment and assess interest (but not penalties) retroactive to the date the credit was claimed; environmental attributes of the renewable energy system remain with the applicant; incentive certifications and amounts are not treated as confidential taxpayer information for RCW 82.32.330 and are subject to disclosure, while names and addresses of incentive recipients are protected from public disclosure under chapter 42.56 RCW. The WSU extension energy program must collect application and program data and JLARC must review the tax preference as part of its 2030 tax preference reviews; failure to provide requested data can result in loss of a credit award or incentive payment the following year. Program applicants and recipients must retain records for five years and allow examination on notice. The extracted material omits or is unclear about several items: the specific identity of “the department” referenced for certifications and tax administration is not named; the full text of some sections (notably sections 3, 4, 5, and 6) and any overall funding or total amount authorized for credits are not included; and portions of the act appear cut off mid‑sentence. These gaps prevent confirmation of some procedural details and any overall program cap or expiration language that may appear elsewhere in the bill.

If enacted, the law would push large electric utilities (those with more than 100,000 Washington retail customers) to run approved programs that pay homeowners and other qualifying residential customers to install permanently mounted, grid‑connected battery systems, and to use those batteries either through time‑of‑use rates or by aggregating them into utility‑operated virtual power plants. Utilities would face upfront program costs but could offset some of those costs with a new tax credit that covers incentive payments and a limited share of program upgrades; tax credits are capped by a percentage of prior taxable power sales, are nonrefundable, and expire on set dates, so utilities’ recovery of costs would be limited and time‑bound. Utilities must also meet new design and equity rules (at least 40% of program benefits targeted to low‑ and moderate‑income households and related entities), adopt installer and equipment standards, keep customer data strictly for program use, respond to eligibility and payment notifications within short timelines, and accept audits and data collection by WSU and review by JLARC. Households and other eligible customers (including nonprofits, tribal governments, housing authorities, and academic institutions) could receive substantial per‑kilowatt‑hour incentives (higher amounts for low and moderate income) up to an 18 kWh cap per customer, but must complete certification, income verification, and retain records for five years; leases are not allowed and environmental attributes of the systems remain with the owner. Practical limitations and uncertainties include strict program time windows (payments only between July 1, 2026 and June 30, 2036, with tax credits subject to earlier claim deadlines), the tax credit annual and total limits that could restrict how many incentives utilities can afford to pay, and missing details in the text about which state agency is the named "department" and the total authorization amount that would determine how many incentives can actually be funded.