THE TAX CREDIT TIME CRUNCH

Time is running out!

With the One Big Ugly Budget Bill’s passage, the sun is setting on a number of the Inflation Reduction Act’s clean energy tax credits—and consumers, developers, and state and local governments must scramble to take advantage of them before they’re gone.

Among these powerful incentives are the EV tax credits, which end on September 30th, consumer credits for weatherization and residential clean energy, which expire on December 31st, and the production and investment tax credits for wind and solar, which projects will only be eligible for if they start construction before 2026. If developers miss that deadline, they’ll be up against tighter deadlines and stricter sourcing requirements.

It’s a race against the clock—and the Trump administration is working to make it even harder to deploy clean energy before the credits disappear.

During the budget reconciliation process, Republican legislators who felt the bill was too soft on clean energy struck a deal with the President. If he ordered the Treasury Department to redefine what it means to start construction, they would vote in favor of the bill.

Now, those updated guidelines have been released—and while they could have been much worse, they’re still expected to result in a loss of 60 gigawatts of clean energy capacity over the next five years. That means insufficient energy to meet demand, significantly less investment in communities across the country, and electricity prices—which are already on the rise—climbing even higher.

But progress is still possible.

Earlier this month, Colorado Governor Jared Polis directed state agencies to do everything they can to unleash clean energy before the federal tax credits expire. This means addressing troublesome administrative bottlenecks, speeding up state reviews, and getting wind, solar, and battery projects online or under construction as quickly as possible. The governor is also ramping up resources for residents, making it easier for households to identify which federal tax credits they qualify for.

And other states aren’t backing down, either.

Just two weeks after the budget bill was signed into law, Maine moved to secure contracts for 1,600 gigawatt-hours of renewable energy. Connecticut and New York also have plans to scale up their procurement and do what they can to complete current projects.

This rapid clean energy build-out is exactly what the current moment demands—and it presents a powerful opportunity to achieve more than just short-term progress.

What Governor Polis and other leaders are now publicly encouraging—the complete removal of bureaucratic red tape around clean energy development, accelerated renewables procurement, and even siting reform and interconnection queue fixes—has the potential to put us on a powerful long-term trajectory. And it’s one that will help us meet the rising energy demand and avoid the most devastating impacts of the climate crisis, even as the Trump administration works tirelessly to extend the stranglehold of the fossil fuel industry on our energy economy.

Join us as we urge our elected officials to act—and lay the groundwork for the future in the process!