Batteries are not fuel cells. The help text in TurboTax on the "Enter Any Fuel Cell Properties Improvements" page, says a fuel cell "converts fuel into electricity using electrochemical means." Batteries do not have that limit, and this can also be confirmed on the IRS website: https://www.irs.gov/instructions/i5695
However, the software does do the calculation correctly, giving 30% of the cost of the batteries with no limit. I was able to confirm this thanks to your help in finding where the carryforward credits could be seen (box 16 of 5695). Thank you for pointing me to this.
As for the federal taxes being non-zero, your explanation seems plausible to be correct in my case. I have a mix of self-employment, rental income and capital gains taxes. My little back of the napkin math shows that it's likely that this lowers the federal tax liability for capital gains and maybe the rental, but not the rest.
It's confusing to know whether income not received from an employer (such as rental income or capital gains) are considered "self-employment". This is why I buy TurboTax, so I don't have to figure out these overly complicated rules.
