Federal court tosses out Trump’s strict limits on solar and wind tax credits

 Last August, the Internal Revenue Service issued strict new rules for solar and wind developers hoping to tap the federal tax credits known as 45Y, for the production of carbon-free electricity, and 48E, for investment in green generating assets. For years, the U.S. government had required companies to invest 5% of the total cost of the project by a certain deadline to qualify for the rebates. But last summer, the Trump administration eliminated the 5% threshold and instead mandated that projects over 1.5 megawatts in capacity show evidence that physical construction has begun to be eligible for the writeoffs.

In all, the new rules “could have been so much worse,” Heatmap’s Emily Pontecorvo wrote at the time. But requiring construction to start narrowed the scope of how many turbines and panels could be built before the two tax credits are phased out this July 4. With less than a month to go before the credits go away, a federal court has intervened to restore the original 5% rules. On Saturday, the U.S. District Court for the District of Columbia overturned the Internal Revenue Service’s strict new rules. The decision found that the Trump administration had repeatedly failed to back up its justifications for eliminating the 5% provision, consider reasonable alternatives, or demonstrate that the policy change wasn’t motivated by discriminatory views of the wind and solar sectors. “Evidence in the record leaves substantial doubt that the proffered explanation sincerely accounts for the agency’s decision,” the ruling reads. “A thorough review of the record undercuts the conclusion that the defendants made a reasoned decision to eliminate the 5% safe harbor for wind and large-scale solar projects based on concerns about stockpiling.”

While significant, the decision — which was effective immediately — doesn’t change the Trump administration’s restrictions on using tax credits for projects made with Chinese imports. And Crux Climate, the tax credit marketplace, cautioned that few developers may be able to spring into action to seize on the ruling in the next 26 days before the rebates officially end.

Comments

Post a Comment

Popular posts from this blog

Trump’s Executive Order Throws Caution to the Wind (and Solar)

  Enacted in August 2022, the Inflation Reduction Act (the “IRA”) expanded energy tax credits by increasing credit amounts, broadening eligibility beyond wind and solar, and allowing credits to be developed and sold, as outlined  here . The winds have now shifted . Two years later, the One Big Beautiful Bill Act (the “OBBBA”) slows that momentum by  delivering a final blow to wind and solar , terminating the tech-neutral investment tax credit (“ITC”) and production tax credit (“PTC”) for projects that are not placed in service before 2028, with a safe harbor for projects that begin construction within 12 months of enactment. The OBBBA also  introduces sweeping “foreign entity of concern” limitations that could disqualify many projects from the credits entirely. The wind-down  doesn’t stop there . On July 7, Trump issued an  executive order  giving Treasury 45 days to issue new guidance on what it means to begin construction, dispelling any doubt about ...
Read more

an example of the big green comment people are filling on NYPA draft plan

  It's so frustrating and NYPA's unwillingness to fully identify the projects is suspect, as well.  I spent significant time this morning trying to find information about a company called Forward Power which is supposedly sponsoring project E4, a 180 MW project in Charleston, but they have no web presence.  A little more digging and I found that they are a joint venture between Invenergy and another company associated with Clean Path.   This led me to the following links, which seems to point to NYPA attempting to revive Clean Path as a "Primary Transmission Project."  Forward Power was a rumored bidder on the project according to the 1st article.  On Thursday, the PSC denied the petition, but it seems a clear indication of NYPA's downstate advocacy in this regard.  Apologies if I am covering info that you already are aware of. https://subscriber.politicopro.com/article/2024/12/nypa-pitches-transmission-line-revival-00195956   (Sorry, it's be...
Read more

Trump’s Attack on Wind, Solar Cuts Deeper Than Industry Expected

Image
  August 8, 2025 Takeaways  The Trump administration has instituted permitting reviews and imposed standards that threaten US wind and solar developments, and has rescinded Biden-era decisions earmarking coastal waters for future wind turbines. The actions have contributed to the cancellation or delay of more than $22 billion worth of clean energy projects since January and the loss of thousands of jobs, according to an analysis from the E2 advocacy group. Trump administration officials say the moves are justified to ensure the US has an abundance of always-on power sources,  with Interior Secretary Doug Burgum stating that "leveling the playing field in permitting supports energy development that’s reliable, affordable and built to last ".   President Donald Trump is escalating his attacks on wind and solar power from the rhetorical to the tangible, mounting a rapid-fire campaign that exceeds the industries’ worst fears.   In just the past few weeks, the Trump ...
Read more