Wind and solar development --- July 4 deadline moves closer and closer

 Today is January 4, 2026. One reason today is significant is that July 4, 2026 is now exactly just six months away. And that is not a long time.

July 4, 2026 is the cutoff date after which new wind and solar projects will no longer qualify for federal tax credits ---- unless construction begins by that date, and they are placed in service by December 31, 2027.

This creates a compressed development window for developers.

To determine a “begin construction” date the IRS will apply a “significant physical work” standard, not just safe‑harboring equipment or spending money on a project yet to be built. The IRS says that significant physical work must be understood to be integral to the specific project in question, thoroughly documented, and with continuous onsite activity all the way through to completion.

And -- even if a project begins construction before July 4, 2026, it must be “placed in service” by December 31, 2027 to receive credits. This means that developers can’t show up to do some onsite work and then back off for an indefinite period. They must be fully prepared and equipped to move forward.

On top of these cutoff dates, there are also the new Foreign Entity of Concern (FEOC) rules that went into effect on January 1. Under FEOC a wind or solar developer beginning as of now will be ineligible for federal tax credits if they utilize partnerships, equipment, components or financing from a short list of problematic countries – notably China.

This means that developers are facing a six‑month window now where projects must begin construction and use only FEOC compliant supply chains and money.

Wind and solar power development has never existed on any significant level in the United States without the benefit of the federal tax credits. Those tax credits gave birth to the industry and have singularly sustained it ever since.

A race is on to harvest the last of those tax credits while there is still time --- for those developers who think they can pull it off in time.

Renewable industry observers say loss access to the federal tax credits that have underpinned U.S. wind and solar economics for three decades is likely to reshape the U.S. renewable energy landscape for years to come.

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