A Second Wind For Energy Tax Credits?

Affordability is emerging as a central theme heading into the midterm elections, and it may reignite debate over the future of energy tax credits as policymakers search for ways to lower energy prices.

In our last update here, we discussed what remains of the clean energy tax credit landscape following the July 2025 enactment of the One Big Beautiful Bill Act (the “OBBBA”). As enacted, the OBBBA significantly scaled back clean energy incentives by eliminating several consumer-facing credits and terminating credits for wind and solar projects that are not placed in service before 2028, subject to a limited safe harbor for projects that “begin construction” before July 5, 2026.

As we approach the expiration of that safe harbor, many key questions remain unanswered, and efforts to challenge the OBBBA’s implementation are gaining traction. Most recently, a federal court vacated Treasury’s notice that narrowly interprets the OBBBA’s “begin construction” requirement. The court found the