The Big Beautiful Bill Torpedoes Big Solar & Big Wind

 Last November, I published 10 can’t miss predictions about the presidential election. One of my predictions was that if Donald Trump won another term in the White House, he wouldn’t repeal the alt-energy subsidies in the Inflation Reduction Act. I wrote:

The idea that the US will spend trillions on alt-energy projects while the deficit is soaring ($35.8 trillion and counting) is the definition of fiscal insanity. But Big Business is feasting on the subsidies, and the most powerful trade associations in Washington have pledged to fight to continue the handouts. Thus, there’s little reason to expect Trump will be able to eliminate the IRA subsidies even if he wants to.

 

The other nine predictions are still looking pretty good. But right now, it looks like I was wrong about the IRA subsidies. (Yes, it happens.)

The latest version of the One Big Beautiful Bill Act, which was released by the Senate yesterday, takes a flamethrower to the massive alt-energy subsidies that were passed in 2022 under the IRA. As Reuters explained, the legislation, “will effectively repeal the incentives for solar and wind immediately.” Furthermore, it will impose a tax on wind and solar projects completed after December 31, 2027, if they cannot prove they do not contain any Chinese components. Additionally, tax credits for new, used, and commercial electric vehicles would expire on September 30. (Predictably, Trump’s former DOGE buddy, Elon Musk, doesn’t like this provision.)

To be clear, under the reconciliation process, the OBBBA has a long way to go. It still faces debate in the Senate and must be sent back to the House for further consideration. Nevertheless, if the current version of the bill reaches Trump’s desk and becomes law, it will be good news for taxpayers, wildlife, and rural Americans who are fighting back against the encroachment of massive alt-energy projects.

Let’s take a look.

First, let’s consider the impact on taxpayers.

Few businesses have benefited more from government handouts than Big Wind and Big Solar. Since the production tax credit was first implemented in 1992, Big Wind has engineered 11 extensions of the lucrative federal subsidy. The PTC provides owners of recently built wind projects with $30 for every megawatt-hour of electricity they produce. Last year, Brent Bennett of the Texas Public Policy Foundation found that wind subsidies cost federal taxpayers $76 billion between 2010 and 2023. The solar subsidies cost another $65 billion.

As I explained in March, the companies now on the board of the American Clean Power Association have collectively received over $47 billion in subsidies, loans, and loan guarantees, most of which were awarded over the past decade or so. Furthermore, approximately one-third of that $47 billion went to foreign corporations, such as Iberdrola, Shell, and Equinor.

As the Energy Bad Boys, Mitch Rolling, and Isaac Orr, pointed out a few weeks ago, “While the original purpose” of the PTC was to jump-start the wind industry “to compete with other resources, it didn’t take long for the goalposts to move.”

 

As seen above, the latest extension of the PTC could last 14 years. But under the terms of the IRA, the subsidies are, in effect, permanent giveaways to Big Wind and Big Solar. As the Cato Institute’s Travis Fisher and Joshua Loucks found, under the IRA, the PTC and the investment tax credit (used mainly by solar producers) were “functionally unlimited” and could cost the federal treasury over $3 trillion by 2050. In addition, the energy consulting firm Wood Mackenzie found that the cumulative cost of the IRA could reach $2.5 to $3 trillion, with most of the cost allocated to utility‐​scale solar projects.

In short, canceling the alt-energy subsidies is good news for taxpayers. It will end decades of corporate welfare that has benefited a handful of big companies at the expense of American taxpayers. If solar and wind are, as we’ve been told, cheaper than conventional forms of electricity generation, it’s time for them to prove it — without federal tax money.

Second, the cancellation of the lavish subsidies for Big Wind will be good news for American wildlife. I have been writing about bird kills and energy production for more than 30 years. Here’s a piece I published in the Christian Science Monitor in 1990. There is no doubt that Big Wind is killing huge numbers of avian wildlife. In 2009, the U.S. Fish and Wildlife Service (FWS) estimated that wind turbines were killing over 400,000 birds per year. In 2012, a study by wildlife biologist Shawn Smallwood estimated that wind turbines were killing about 600,000 birds in the US each year. In 2020, Smallwood published another study that estimated turbines were killing 2.2 million bats in the US per year.

Despite these facts, Big Wind has knowingly and purposely located wind projects in areas where they know their turbines will kill our wildlife.

In 2022, as I explained in Newsweek, NextEra Energy, the world’s biggest alt-energy producer, “repeatedly ignored warnings from federal authorities that its proposed wind projects would kill eagles.” That year, the Department of Justice sentenced the company to probation and fined it about $35 million for repeated violations of the Migratory Bird Treaty Act. (The company also violated the Bald and Golden Eagle Protection Act, but it was not prosecuted under that statute.) According to the DOJ, NextEra has killed at least 150 Bald and Golden Eagles at its wind projects in eight different states since 2012.

But it was NextEra’s “blatant disregard” for federal law at a wind project in Wyoming that led the DOJ to prosecute it for killing some of our most iconic birds. In an April 5, 2022 press release, the DOJ said NextEra "received hundreds of millions of dollars in federal tax credits for generating electricity from wind power at facilities that it operated, knowing that multiple eagles would be killed and wounded without legal authorization, and without, in most instances, paying restitution or compensatory mitigation."

NextEra was so eager to tout its “green” credentials that it featured the very wind project that was killing eagles in its 2021 ESG report.

 

Stopping (or slowing) the expansion of Big Wind is good news for eagles, particularly in Wyoming.

Denver-based billionaire Philip Anschutz owns Power Company of Wyoming, which is planning to build the Chokecherry Sierra Madre wind project in Carbon County, Wyoming. If built, the $5 billion, 3.5-gigawatt project could kill dozens of Golden Eagles every year. A 2019 assessment by the Bureau of Land Management estimated that the project “would result in annual mortalities of 6,300 bats, 150-210 raptors, 46-64 Golden Eagles, and 5,400 non-raptors.”

The Chokecherry project was first announced in 2012. Last October, the Power Company of Wyoming got a second extension of the building permit for the Chokecherry project from the Carbon County Commission. At that time, the company stated that it may finish the project in 2029. However, the future of the Chokecherry project is now in doubt.

Let’s hope it never gets built.

Finally, the end of the IRA subsidies for Big Solar and Big Wind will be good news for rural Americans who have been fighting Big Solar, Big Wind, and Big Battery projects. As seen in the Renewable Rejection Database, there have now been 827 rejections or restrictions of wind or solar projects in the US since 2013. Among the latest rejections occurred earlier this month in Wagoner County, Oklahoma, where county commissioners voted to deny a solar project. A few days before that, according to an article in the Yankton Daily Press & Dakotan, the board of supervisors in Knox County, Nebraska, voted to approve a ban on “all future commercial wind and solar energy developments in the county, voting 6-1 on each of the county planning commission’s two recommendations.”

In addition, rural communities are opposing high-voltage transmission projects. On June 25, county commissioners in Elbert County, Colorado, voted unanimously to deny permits to Xcel Energy for the company’s proposed Power Pathway project, which is designed to move solar and wind energy from eastern Colorado to customers in Denver. The 3-0 vote by the county commission followed a 9-0 vote by the county planning commission to deny the permits for the project. The power line, which has faced fierce opposition from the county’s ranchers and landowners, would nearly bisect the county, which lies southeast of Denver.

Elbert County Commissioner Byron McDaniel told the Colorado Sun, “This line serves no purpose here in Elbert County, and, frankly, I don’t care about Denver.”

That sentiment can be found across rural America when it comes to large alt-energy projects, including transmission lines. Urban voters may like the idea of alt-energy, but they don’t have to live in the shadow of Big Solar, Big Wind, and Big Transmission projects. If subsidies for solar and wind energy are eliminated, the need to build high-voltage transmission projects such as the Power Pathway in Colorado, and Invenergy’s controversial Grain Belt Express, which aims to run a high-voltage line across Missouri, will be undermined or even eliminated. (It’s important to note that Invenergy, which is fronted by billionaire Michael Polsky, is majority-owned by the Canadian pension firm, CDPQ.)

In short, rural Americans from Maine to Hawaii will be relieved if the OBBBA kills the alt-energy subsidies. The current version of the bill will also kill the offshore wind scam, which will be great news for whales and other marine mammals. But that’s a topic for another article.

Media Hits

It has been a busy few weeks. Since June 10, I’ve been in Brisbane, Branson, and Boston. (We also had stops in Melbourne and Sydney.) Last Wednesday, during a brief stop in Austin, I squeezed in some podcast interviews. Here are some recent media hits.

·         On Wednesday, I spoke to my friend, Jim Puplava, on the Financial Sense podcast. We talked at length about China’s near-monopoly on rare earth elements and strategic elements. Jim looks as these issues from the US strategic perspective and the investing angle. I was happy to hear how Jim sees the investing landscape, particularly with regard to base metals and commodities. We also spent a considerable amount of time talking about copper and copper demand. I’m fascinated by the copper market and will be writing about it soon. It was a fun conversation. The audio and transcript of our discussion are available here.

·         Here’s a video of the speech I gave in Sydney at the end of my speaking tour in Australia that was sponsored by the Institute of Public Affairs. Many thanks to the excellent team at IPA for making it happen. It really was a great adventure. This video has an excellent introductory analysis from my friend (and recovering TV journalist) Chris Uhlmann. My segment begins around the 23-minute mark.

 

Finaly, the IPA made short video from one segment from my Sydney speech, which is pretty fun. Have a look: https://youtu.be/zdgdPf5iOwI