FEOC compliance and BESS financing: managing supply chain risk without compromising quality

How FEOC guidance is reshaping QAQC, technical due diligence, and ITC eligibility for battery energy storage projects

In an interview with Energy‑Storage.News, William Lauwers, Head of Technology for BESS at Enertis Applus+, discusses the most recent Foreign Entities of Concern (FEOC) guidance and how it affects securing investment tax credits (ITC) for battery energy storage (BESS) developers.

Commenting on the latest FEOC rules and supply chain traceability requirements for battery energy storage systems (BESS), Lauwers explains that an exclusive focus on regulatory compliance may introduce new technical and quality risks if BESS manufacturing quality and factory Quality Assurance and Quality Control (QAQC) are overlooked.

While Independent Engineers and Owner’s Engineers cannot mandate specific procurement choices, Enertis Applus+ is increasingly advising clients to strengthen technical due diligence through factory audit rights, targeted in‑line inspections, and factory acceptance test (FAT) witnessing. These measures help safeguard asset reliability, warranty enforceability, and long‑term project bankability in a tightening regulatory landscape.

On how transactions are still moving forward under the latest FEOC guidance, Lauwers notes that while FEOC compliance is increasingly being addressed contractually, it has yet to be fully tested through audits. Developers are therefore weighing trade‑offs—between selecting lower‑cost components and forgoing the Investment Tax Credit (ITC), or paying a premium to secure tax‑credit eligibility.

As FEOC requirements continue to evolve, he adds that BESS financing structures are adapting, drawing on models already familiar in solar and wind projects without incentives. Supported by strong market fundamentals, maturing energy storage technology, and more sophisticated deal structures, transactions are continuing to advance despite the shifting risk landscape.

Read the full interview here.

As the U.S. BESS industry accelerates, our technical advisory expertise empowers clients to mitigate risk, assure quality procurement, strengthen project economics, and secure financing—even in a rapidly shifting policy environment.

Reach out to our team at info.us@enertisapplus.com to explore how we can add value to your next energy storage investment.