Senate GOP tax bill could crush wind and solar power, advocates say
[July 01, 2025]
By MATTHEW DALY and ALEXA ST. JOHN
WASHINGTON (AP) — Clean energy advocates were already bracing for a
Republican-led bill that would phase out tax credits for wind, solar and
other renewable energy as President Donald Trump and GOP lawmakers moved
to dismantle the 2022 climate law passed by Democrats under former
President Joe Biden.
But a proposal that emerged over the weekend was even more drastic than
they thought.
It was more aggressive in ending incentives for clean energy than a
previous Senate version and would even impose new taxes on some wind and
solar projects while boosting production of coal used in steelmaking.
The Senate was moving Monday to approve Trump's big bill of tax breaks
and spending cuts even as Democrats lined up to challenge it.
The GOP plan is “a death sentence for America’s wind and solar
industries” that will lead to a spike in Americans’ utility bills and
jeopardize hundreds of renewable energy projects slated to boost the
nation's electric grid, said Oregon Sen. Ron Wyden, the top Democrat on
the Senate Finance Committee.
“Their plan started out as a phase-down of the tax credits I wrote for
wind and solar” in the 2022 climate law, Wyden said. “But now they’re
proposing an outright massacre with punishing new taxes on these
industries that happen to be the cheapest and easiest ways to get new
energy on the grid."
Republicans say it will save people money
Republicans said the tax-cut bill represents historic savings for
taxpayers and supports production of traditional fossil-fuel energy
sources such as oil, natural gas and coal, as well as nuclear power,
increasing reliability.
“To achieve this record level of savings, we are slashing Biden’s Green
New Deal spending and promoting America-First energy,'' Idaho Sen. Mike
Crapo, chairman of the Senate Finance panel and a lead architect of the
bill, said in a statement.
“We stop penalizing fossil fuels in favor of unreliable and expensive
green energy, and instead support consistent energy sources, making
energy affordable again.” Crapo said.
The Senate bill eliminates “hundreds of billions of dollars of the Green
New Deal subsidies, including ending wasteful credits like the EV tax
credit,” he added, referring to a Democratic measure included the
climate law to provide incentives for electric vehicles, which don't
emit planet-warming greenhouse gases.
Some moderate senators, such as Sen. John Curtis, R-Utah, were seeking
to strip the new tax on wind and solar and make other changes, but it
was unclear whether those proposals would advance.
“Taxing energy production is never good policy, whether oil & gas or, in
this case, renewables,'' said Neil Bradley, executive vice president of
the U.S. Chamber of Commerce. “Electricity demand is set to see enormous
growth & this tax will increase prices. It should be removed."
If approved unchanged, the measure will kill investment in renewable
energy and jeopardize hundreds of gigawatts of new power supply that
would otherwise help the U.S. meet rapidly rising electricity demand as
data centers, artificial intelligence and other growing uses strain the
power grid, environmental advocates said.
Advocates of green energy worry of a daunting future
The GOP plan would "lock in higher household energy bills, kill American
jobs ... and torch our future,'' said Mattea Mrkusic, who leads energy
policy for the environmental group Evergreen Action.
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Senate Finance Committee Chairman Mike Crapo, R-Idaho, arrives for a
closed-door Republican meeting to advance President Donald Trump's
sweeping domestic policy bill, at the Capitol in Washington, Friday,
June 27, 2025. (AP Photo/J. Scott Applewhite)
The bill would cut off climate law credits for projects that aren’t
“placed in service” — that is, plugged into the grid — by the end of
2027. That timeline is more aggressive than previous proposals that
set deadlines for projects to begin construction in order to receive
the credit. The new standard is virtually impossible for most
projects to meet, advocates said.
The legislation also blocks credits for companies using components
from adversaries such as China and adds a new tax on wind and solar
projects that don’t follow certain supply chain rules.
Princeton University Professor Jesse D. Jenkins said he was
surprised at the Senate bill's speed in ending wind and solar
incentives and shocked at the proposed tax credit for metallurgical
coal, a highly polluting form of coal that is used in steel-making
and often exported to countries like India and Brazil.
“This bill kills the industries of the future while subsidizing the
industries of the 19th century. It’s insanity!” Jenkins said in a
post on social media.
If passed as proposed, the bill will lead to higher energy prices,
fewer jobs, less investment in American energy production and less
confidence in the American business environment, Jenkins said.
A volley of responses comes in from both sides
Tom Pyle, president of the conservative American Energy Alliance,
called the Senate bill a move in the right direction.
“If, as supporters of the Inflation Reduction Act are complaining,
repealing these subsidies will ‘kill’ their industry, then maybe it
shouldn’t exist in the first place," Pyle said, referring to the
2022 climate law.
“Extending green giveaways on the backs of American taxpayers is
shortsighted and neglectful," Pyle said. “It’s time for Congress to
deliver both energy reliability and the largest tax cut in history
to President Trump and the American people.”
Jason Grumet, CEO of the American Clean Power Association, called
the Senate bill a “midnight dumping” and said it would punish the
fastest-growing sectors of the U.S. energy industry.
“It is astounding that the Senate would intentionally raise prices
on consumers rather than encouraging economic growth and addressing
the affordability crisis facing American households," Grumet said.
The bill would “strand hundreds of billions of dollars in current
investments” and land hardest on rural communities that would
benefit the most from clean energy investment, he said.
Abigail Ross Hopper, president and CEO of the Solar Energy
Industries Association, called the bill “a direct attack on American
energy, American workers and American consumers."
“Make no mistake: If this bill passes, Americans will pay the price
— literally," Hopper said. "Power bills will rise. Factory jobs will
vanish. Families will be forced to spend more just to keep the
lights on and their homes cool. All while we become more dependent
on foreign energy and more vulnerable to blackouts.”
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St. John reported from Detroit.
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