Despite the removal of a proposed excise tax on renewable energy, industry advocates and lawmakers warn that the U.S. Senate’s newly passed budget bill will hinder the development of wind and solar projects. Although the excise tax on non-compliant solar and wind projects was eliminated after negotiations with key Republicans such as Senators Joni Ernst, Chuck Grassley, and Lisa Murkowski, critics argue that other aspects of the bill still pose significant challenges.
Changes to the timeline for renewable projects to qualify for tax credits—now limited to those beginning construction before 2026—will make it harder to launch new initiatives.
Bill Sparks Economic Concerns Amid Shift Toward Conventional Energy and Away From Renewables
Experts and advocacy groups warn that the bill’s provisions could cause widespread economic disruption. Research firm C2ES estimated that the legislation could lead to the loss of 2.3 million jobs, while Energy Innovation projected a drop of 300 gigawatts in electricity capacity.
This reduction could increase consumer energy bills and halt progress on projects across the country. Community solar developers, in particular, warned that the bill would halt thousands of projects in progress, risking billions in private investments and eliminating jobs in trades such as contracting, electrical work, and farming.
Senate Budget Bill Drops Tax but Deals Major Blow to Wind and Solar GrowthSupporters of the bill, primarily Republican lawmakers and the Trump administration, argue that cutting renewable subsidies will remove market distortions and favor more stable energy sources like natural gas and nuclear. Energy Secretary Chris Wright praised the bill as a return to “energy that works without subsidies.”
President Trump emphasized the bill’s broader goals of slashing taxes, cutting social safety nets, and prioritizing defense and immigration spending. These changes reflect a broader ideological shift toward conventional energy sources and away from government-supported clean energy.
Selective Energy Support Shifts Focus from Renewables to Traditional and Emerging Technologies in Bill
Although wind and solar industries are set to lose significant support, the bill introduces new subsidies for other forms of energy. A new tax credit was added for coal used in steel manufacturing—previously reserved for critical minerals—potentially funneling hundreds of millions of dollars into a struggling industry.
At the same time, the bill preserves or enhances support for technologies such as hydrogen, nuclear, geothermal, hydropower, and carbon capture, indicating a selective strategy in promoting U.S. energy dominance.
While some conservative clean energy advocates like Heather Reams applauded parts of the bill, they also called for critical revisions as it moves to the House of Representatives. Reams emphasized the importance of maintaining wind and solar credits to ensure continued domestic energy development.
She urged lawmakers to adjust the bill to make clean energy tax incentives more practical and accessible. As debate shifts to the House, stakeholders across business, labor, and environmental sectors continue to push for more balanced support for renewable energy.
