It removes excise tax on solar and wind projects and extends for a year tax credits on renewable energy projects.
Senate Republicans on July 1 revised some energy tax provisions in a sweeping domestic policy bill as part of a compromise reached with Senate holdouts to secure their votes for the package.
Republicans removed a proposed excise tax on solar and wind development and added a year for renewable energy projects to begin construction to qualify for tax credits. Instead of ending on Dec. 31, 2026, that program ends on Dec. 31, 2027.
The bill, H.R. 1, the fiscal year 2026 Budget, which Trump dubbed the “One Big Beautiful Bill Act,” has gone back to the House after the Senate passed it 51–50, with Vice President JD Vance breaking a tie.
Three Republicans—Sens. Rand Paul (R-Ky.), Susan Collins (R-Maine), and Thom Tillis (R-N.C.)—joined Democrats in rejecting the measure.
Alaska’s Lisa Murkowski, a key undecided GOP senator who raised concerns about energy-related provisions in the bill before the late revisions, was among the clinching votes to end the chamber’s “vote-a-rama” that began Monday afternoon and continued through the night before concluding at midday on Tuesday.
The pivotal energy-related compromise in moving the Senate’s version of the GOP-led megabill to the House was dropping a new excise tax for any solar projects beginning after June 2025 that use components from adversaries such as China, which dominates the solar supply chain.
The nascent domestic solar industry relies on solar panels and other components manufactured in China or by Chinese-owned companies in countries such as Vietnam. President Donald Trump and some Republicans have criticized clean energy tax credits in the policy bill, calling it a “scam.”
“None of it works without massive government subsidy (energy should NOT NEED SUBSIDY!),” Trump wrote in a June 21 post on his Truth Social platform, referring to green energy projects. “Also, it is almost exclusively made in China!!!”
Even without the excise tax, the nation’s solar industry could be handicapped by ending the technology-neutral Production Tax Credit. It subsidizes zero-emission energy sources such as solar, wind, nuclear, hydropower, and geothermal that, under the Inflation Reduction Act, are to expire in 2032.
The revised Senate version of the bill brings forward the phase-out date to Dec. 31, 2027.
As with the version of the bill passed by the House, the Senate-passed megabill preserves tax credits for companies that build nuclear reactors, geothermal plants, hydropower dams, and battery storage projects through 2033.
Other than defining coal as a critical mineral, as Trump did in an executive order earlier this year, and incorporating coal-fueled projects into the Production Tax Credit program, the Senate bill’s energy-related provisions largely replicate but also modify the version adopted by the House by a single vote on May 21.
By John Haughey
