Solar Tax Credit Secured
PowerBank confirms safe harbor for 23 solar and storage projects, securing federal tax credits.
PowerBank Corporation (NASDAQ: PBK) has locked in $242.3 million in equipment procurement deals across 23 distributed solar and energy storage projects in New York and Pennsylvania, securing what is known as "Safe Harbor" status for all 23 sites, according to PR Newswire. The move protects the projects' eligibility for federal Investment Tax Credits worth an estimated $94.7 million before a critical July 4, 2026, deadline.
Once built, the portfolio will deliver 97 MW of solar power and 42 MWh of battery storage — enough to power roughly 11,000 homes annually, Barchart reported. The company completed the deals in two phases, racing to stay ahead of sweeping changes to U.S. clean energy tax law.
A Two-Phase Sprint to Beat the Tax Deadline
PowerBank split its procurement into two rounds. Phase 1 closed in December 2025, covering 15 New York projects with 67 MW of solar and 11 MWh of storage, totaling $168 million in construction value, according to Benzinga. Phase 2 wrapped on June 9, 2026, adding 8 more projects across New York and Pennsylvania — 30 MW of solar and 31 MWh of storage — for another $74.3 million.
The rush was driven by the One Big Beautiful Bill Act of 2025, signed into law on July 4, 2025. That law moved up the deadline for solar developers to "begin construction" and qualify for Section 48E tax credits. Missing the July 4, 2026 cutoff would have wiped out tens of millions in federal tax benefits for PowerBank's projects.
Court Ruling Restored the 5% Safe Harbor Rule
PowerBank's safe harbor was secured through two legal pathways. The first is the IRS "Physical Work Test," which requires developers to start real, significant construction work. The second is the "5% Safe Harbor" — a rule that lets developers qualify by spending at least 5% of a project's total cost on equipment. The IRS tried to kill the 5% option in August 2025 via Notice 2025-42, according to ADVFN.
On June 6, 2026, a U.S. District Court judge struck down that IRS rule, calling it "arbitrary and capricious." The ruling restored the 5% Safe Harbor for solar and wind developers. PowerBank confirmed all 23 projects now meet safe harbor requirements under both pathways — a "belt-and-suspenders" approach that reduces legal risk if the government appeals the ruling before the July deadline.
$94.7 Million in Tax Credits Makes Projects Financeable
Protecting the tax credits is not just a legal win — it is a financial one. The $94.7 million in estimated Investment Tax Credits makes the projects far more attractive to "tax equity" investors, who fund clean energy builds in exchange for tax benefits. Without safe harbor status, lenders and investors would likely walk away from projects that face uncertain federal support.
PowerBank, a Toronto-based independent power producer, is developing the portfolio through its wholly owned U.S. subsidiary, Abundant Solar Power Inc. The company is pitching the projects as critical infrastructure for the "AI Economy," noting that data center power demand is expected to quadruple by 2030. Distributed solar and battery storage at the grid edge, the company argues, can bypass the multi-year waits for utility-scale grid connections.
Regulatory Risk Remains Despite the Court Victory
The court ruling restored the 5% Safe Harbor, but it did not end the uncertainty. The judge sent the matter back to the IRS to rewrite its guidance. If the government appeals and wins a "stay" — a court order pausing the ruling — projects that relied only on the 5% cost method could lose their eligibility again before July 4, 2026, according to Barchart.
PowerBank's decision to use both the Physical Work Test and the 5% Safe Harbor is a direct hedge against that risk. Legal experts have advised developers to pursue both methods wherever possible. The company has not yet announced a financing or construction start date for the 23 projects, which remain in the pre-construction phase pending tax equity and debt financing.
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