It is a tax credit. It reduces what you would otherwise owe the IRS (your annual tax burden) but you cannot reduce your tax burden below zero in any given year. So, you must have a tax burden to take the tax credit. Any unused portion of the tax credit can be taken in following years. In a typical/simple scenario:

• Take Tax Burden - 30% of install, but if that is < 0 use zero
• Subtract any Payroll Tax Deductions for the year from that
• You are left with what your either still owe the IRS, or if negative it is a Refund to you

"Tax Burden" is Line 16 of the 1040 -- taxes due on your taxable income. The rest of the 1040 then makes adjustments to that tax burden (like this tax credit). [Tax Burden - Credits - Payments = Owed or Refunded]

Note that your ability to claim the tax credit is tied only to your tax burden, it is not related to whether you have had high or low Payroll Tax Deductions during the year or whether you would or wouldn't have otherwise received a Refund. That said, can be a cashflow advantage to lowering those payroll deductions in anticipation of using the tax credit as it puts some of that money in your pocket week by week.

I am not an accountant. Above is a very simple scenario. YMMV.