The December 14th, 2023 publication in the Federal Register, the official journal of the U.S. government, clarifies credit rules for the Section 45X Advanced Manufacturing Production Credit (the “Section 45X Credit Rules”) established by the Inflation Reduction Act of 2022.

-Brenmiller Energy Ltd. (Nasdaq: BNRG) ("Brenmiller," "Brenmiller Energy" or the "Company"), a leading global provider of thermal energy storage (TES) systems for industrial and utility markets, today shared comments enthusiastically welcoming the release of initial guidance for U.S. tax credits specifically incentivizing clean energy storage technologies, including TES.

The December 14th, 2023 publication in the Federal Register, the official journal of the U.S. government, clarifies credit rules for the Section 45X Advanced Manufacturing Production Credit (the "Section 45X Credit Rules") established by the Inflation Reduction Act of 2022. The credit rules, currently in a 60-day public comment period, would pave the way for domestic U.S. planning, production, and supply chain development for crucial energy infrastructure like TES if enacted as currently proposed.

"This credit incentive is a pivotal moment for thermal energy storage, and for Brenmiller," stated Brenmiller Chairman and CEO, Avi Brenmiller. "It signals a clear understanding that thermal energy storage is a critical pillar for decarbonization. We believe this proposed regulation's impact on TES will mirror the transformative effect tax credits had on solar and electric vehicles, propelling companies like Tesla."

Brenmiller's turn-key bGen manufacturing system is strategically designed for global replication and local market adaptability. The bGen's modular design with high energy density aligns with the proposed Section 45X Credit Rules, which scales by kilowatt-hour stored, potentially qualifying Brenmiller's maximum-capacity system for a significant credit. Brenmiller has always prioritized establishing local manufacturing footprints within its target markets like the U.S., and the bGen's production lines at its TES gigafactory in Dimona, Israel were designed to be replicated elsewhere with locally sourced components, which can facilitate rapid deployment, minimizing logistical challenges and fostering partnerships with local material suppliers.

The explicit inclusion of TES in the credit program is a significant development. Previously, uncertainty hung over TES eligibility, prompting Brenmiller's active engagement with other companies and associations to proactively advocate for its inclusion over the last year. This change not only benefits Brenmiller but also signifies broader recognition of TES as a vital decarbonization technology. According to a report from the Renewable Thermal Collaborative, if deployed at scale, thermal batteries have the potential to slash emissions by nearly 800 million metric tons per year. Globally, the market for thermal energy storage is predicted to reach over $2 trillion by 2040, according to the Long Duration Energy Storage Council.

The initial guidelines clarify that "modules with no battery cells" manufactured in the U.S., including TES systems, will receive a $45 per kilowatt-hour credit. As an example, a 30 MWh TES system (similarly sized to a recently announced bGen system in Israel) would qualify for a $1.35 million credit under the proposed structure in the U.S. These tax credits are scheduled to phase out gradually from 2030 to 2033.

By absorbing and storing excess wind and solar energy as heat, reaching temperatures of around 650°C (1200°F), the bGen is ideally suited to power industrial processes - projected to be the largest source of U.S. emissions by 2030. This opens doors for cost-competitive clean energy solutions in a sector crucial for national decarbonization goals.

While the potential cost savings for Brenmiller are encouraging, the larger focus lies in building a robust domestic TES supply chain in the United States. The $45/kWh credit unlocks an exciting market potential, and Brenmiller is committed to working with stakeholders to establish a thriving U.S. TES ecosystem.

About Brenmiller Energy Ltd.

Brenmiller Energy delivers scalable thermal energy storage solutions and services that allow customers to cost-effectively decarbonize their operations. Its patented bGen thermal storage technology enables the use of renewable energy resources, as well as waste heat, to heat crushed rocks to very high temperatures. They can then store this heat for minutes, hours, or even days before using it for industrial and power generation processes. With bGen, organizations have a way to use electricity, biomass and waste heat to generate the clean steam, hot water and hot air they need to mold plastic, process food and beverages, produce paper, manufacture chemicals and pharmaceuticals or drive steam turbines without burning fossil fuels. For more information visit the company's website at https://bren-energy.com/ and follow the company on X (formerly Twitter) and LinkedIn.