Solar power CEOs thought they were all set by investing billions in Republican districts to protect their industry from Trump’s anti-renewable energy stance. But, whoopsie daisy, they were dead wrong. The House Republicans passed a tax bill that’s basically a nightmare for solar energy, according to analysts at Jefferies bank. The bill axes crucial tax credits that have been fueling the industry’s growth, causing solar stocks to take a nosedive on Thursday. The Senate still needs to give it the thumbs up, and Jefferies predicts they’ll probably fix the “unworkable” bits. But for now, the tax bill is like a wrecking ball to President Biden’s Inflation Reduction Act, as per the Jefferies crew.
Abigail Ross Hopper, head honcho at the Solar Energy Industries Association, ripped into the tax bill, calling it “willfully ignorant” of solar power and battery storage’s role in meeting the electricity needs of the U.S. She warned that if the bill goes through, the U.S. would basically be surrendering the AI race to China and facing mass blackouts. Over at Sunrun, CEO Mary Powell spilled the beans to CNBC, saying the bill could cost 250,000 jobs and hike up electricity prices for consumers. Sunrun’s shares took a 37% hit on Thursday, marking its worst performance ever. Meanwhile, Trump is cheerleading for the Senate to pass the bill pronto, calling it the “one, big, beautiful bill” on his new social media hangout, Truth Social.
The Clean Energy Boom Could Bust Real Hard
Companies have pumped a whopping $161 billion into mega solar and battery storage projects since the IRA came into play in 2022, according to MIT and the Rhodium Group. Solar and battery storage are on the fast track to becoming the top energy source in the U.S., accounting for a whopping 81% of power additions expected on the grid by 2025, says the Energy Information Administration. But wait for it — the tax bill is about to pull the rug from under these two by axing the tax credits that have been juicing up solar power’s growth. The bill gives the boot to investment and electricity production credits for clean energy facilities that kick off construction 60 days post-enactment or go live post-2028. And it’s not just solar getting the short end of the stick; wind power is also getting the cold shoulder.
Ben Smith, the dude in charge of Rhodium Group’s energy and climate practice, sounded the alarm bells, warning that this move could put a major damper on clean energy growth. According to Rhodium, the deployment of clean energy to the grid could plummet by a whopping 57% to 72% in the next decade. And as if that’s not enough, clean energy projects won’t be able to snag those tax credits as early as next year if they get a helping hand from shady foreign entities. This new rule mostly targets projects that rely on Chinese-made materials like glass for solar panels or cobalt and lithium for batteries. King, another smart cookie, said, “It’s basically saying bye-bye to the credit as early as next year.” So, yeah, the future’s looking pretty bleak for rooftop solar and other clean energy projects.
