Publication date:
June 18, 2025
Senate Republicans Propose Scaled-Back Cuts to Clean Energy Incentives
Senate GOP unveils tax bill that would phase out some green energy tax credits more slowly than House version, but still faces criticism from Democrats and environmental groups.
Governance
Senate Republicans have proposed a new tax bill that would scale back clean energy incentives, though less aggressively than the version passed by House Republicans last month. The Senate proposal would phase out tax credits for residential solar installations and hydrogen production within 180 days of passage. Credits for wind and solar projects would have a longer phaseout period compared to the House bill, but would still make it challenging for developers to qualify.
The bill would boost support for geothermal, nuclear and hydropower projects that begin construction by 2033. It would also end consumer electric vehicle tax credits 180 days after passage, earlier than the current end-of-year expiration.
Senate Republicans framed their version as less damaging to the clean energy industry than the House bill. However, Democrats and environmental groups criticized the proposal, saying it would still significantly impact wind, solar and other renewable projects. Senator Ron Wyden of Oregon, the top Democrat on the finance committee, argued the Senate bill would do "almost 90%" as much damage as the House version.
Industry groups had mixed reactions. The Edison Electric Institute, representing investor-owned electric companies, called the Senate proposal "a step in the right direction" with "more reasonable timelines." However, solar and environmental organizations warned of negative impacts on clean energy deployment, manufacturing jobs, and efforts to address climate change.
The bill would also end tax credits for energy efficient home improvements 180 days after enactment, which critics say would increase energy costs for consumers. Republicans defended the overall package as achieving "significant savings by slashing Green New Deal spending."
The Senate can still modify the proposal before voting. Any differences with the House version will need to be reconciled as Republicans aim to fast-track the legislation for a vote by President Trump's July 4th target date. The outcome could significantly affect the pace of America's transition to renewable energy sources in the coming years.
The bill would boost support for geothermal, nuclear and hydropower projects that begin construction by 2033. It would also end consumer electric vehicle tax credits 180 days after passage, earlier than the current end-of-year expiration.
Senate Republicans framed their version as less damaging to the clean energy industry than the House bill. However, Democrats and environmental groups criticized the proposal, saying it would still significantly impact wind, solar and other renewable projects. Senator Ron Wyden of Oregon, the top Democrat on the finance committee, argued the Senate bill would do "almost 90%" as much damage as the House version.
Industry groups had mixed reactions. The Edison Electric Institute, representing investor-owned electric companies, called the Senate proposal "a step in the right direction" with "more reasonable timelines." However, solar and environmental organizations warned of negative impacts on clean energy deployment, manufacturing jobs, and efforts to address climate change.
The bill would also end tax credits for energy efficient home improvements 180 days after enactment, which critics say would increase energy costs for consumers. Republicans defended the overall package as achieving "significant savings by slashing Green New Deal spending."
The Senate can still modify the proposal before voting. Any differences with the House version will need to be reconciled as Republicans aim to fast-track the legislation for a vote by President Trump's July 4th target date. The outcome could significantly affect the pace of America's transition to renewable energy sources in the coming years.
