Who snuck that in?
Senate Republicans stepped up their attacks on U.S. solar and wind energy projects by quietly adding a provision to their megabill that would penalize future developments with a new tax.
That new tax measure was tucked into the more than 900-page document released late Friday that also would sharply cut the tax credits in the Inflation Reduction Act for solar and wind projects. Those cuts to the IRA credits were added after a late-stage push by President Donald Trump to crack down further on the incentives by requiring generation projects be placed in service by the end of 2027 to qualify.
The new excise tax is another blow to the fastest-growing sources of power production in the United States, and would be a massive setback to the wind and solar energy industries since it would apply even to projects not receiving any credits.
“It’s a kill shot. This new excise tax on wind and solar is designed to fully kill the industry,” said Adrian Deveny, founder and president of policy advisory firm Climate Vision, who helped craft the climate law as a former policy director for Democratic Senate Leader Chuck Schumer.
Analysts at the Rhodium Group said in an email the new tax would push up the costs of wind and solar projects by 10 to 20 percent — on top of the cost increases from losing the credits.
Tucked inside Republicans’ massive domestic policy bill is an excise tax for wind and solar projects, a provision that came as a surprise not just to the renewable energy industry, but also to numerous senators who are crafting the legislation.
In a twist, Republican senators insist they don’t know how or why the tax was inserted into the bill they’re rushing to pass. No senator is taking credit for or defending it. And at least one wants it removed.
Sen. Lindsey Graham, R-S.C., the Budget Committee chairman, who released the 940-page bill, said he doesn’t know where that provision came from.
“It’s a secret, I guess,” Graham told NBC News on Monday evening. “I don’t know where it came from.”
Sen. Lisa Murkowski, R-Alaska, was baffled by the provision, saying the excise tax “just came about” like it was “airdropped” into the bill before the vote Saturday to proceed.
“It wasn’t part of any consideration,” she said. “It’s like, surprise! It’s Saturday night. And we looked at it like, where did this come from?”
“My view of it is — it’s just entirely punitive to the wind and solar industry,” Murkowski said, adding that the Republican-controlled Senate is “looking at different options” to deal with it.
The provision would tax wind and solar projects if a certain share of their components come from China. It is ambiguously worded, and it would empower the Trump administration to iron out the rule.
Sen. Cynthia Lummis, R-Wyo., said she’s “OK with that” when she was asked about the details of the provision. But she, too, was in the dark about who inserted it.
“You can add me to the group that doesn’t know the answer,” Lummis said.