Energy & Environment

The Big Story

Trump further limits renewable tax credits

The Treasury Department issued guidance Friday that narrows which wind and solar energy projects can receive the remaining tax credits that were largely eliminated under the Republicans "big, beautiful bill."

The passed by Republicans last month axes the credits for projects that don't begin producing electricity by 2028.

However, it contains an exemption for projects that begin construction over the next year. Under the law, those projects would remain eligible for the subsidies even if they don't produce electricity under the specified time frame.

The Trump administration's new guidance, however, sets further restrictions on which projects are considered having begun construction.

It says that construction of these projects must be "continuous."

It also defines having begun construction as having done "physical work of a significant nature." This includes activities like manufacturing equipment and excavating land to begin placing equipment in it. But it excludes activities like only having done surveys, test drilling or excavation for purposes of altering the landscape.

The guidance also says that even if the project meets those other requirements, it still must produce electricity by the end of the fourth calendar year after it begins construction.

The renewable energy industry criticized the guidance, saying it would slow the buildup of low-carbon energy sources.

"This is yet another act of energy subtraction from the Trump administration that will further delay the buildout of affordable, reliable power. American families and businesses will pay more for electricity as a result of this action, and China will continue to outpace us in the race for electricity to power AI," said Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association, in a written statement.

Read more at TheHill.com.

Welcome to The Hill's Energy & Environment newsletter, I'm Rachel Frazin — keeping you up to speed on the policies impacting everything from oil and gas to new supply chains.

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