Climatewire | The transition of clean energy could soon be alone.
The “One Big Beautiful Bill Act” adopted last week by the Chamber would effectively put an end to the tax credits on clean energy, reversing a large part of the climate agenda of former president Joe Biden.
Wind and solar projects should start construction within 60 days of adopting the bill – or start operations within two years – to receive credits before expiring. Clean energy factories that use Chinese inputs or equipment would mainly be prevented from receiving federal money. Tax credits for electric vehicles would have disappeared by the end of next year.
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“It is definitely a massive opposite winds,” said Sam Huntington, director of North American power research at S&P Global Community Insights. “If the bill passes when the house has installed it, it is a rather dark scenario for the next few years, at least.”
S&P believes that cumulative wind, solar energy and batteries would drop from 20% to 2040. Bloombergnef called the Bill of the Chamber – which has yet to eliminate the Senate – “the nightmarish scenario for clean energy defenders.”
Many analysts believe that the discount reductions of the bill will be watered down to the Senate. Clearview Energy Partners, a research company, described the bill “a high water brand” for perspectives in a note to customers.
But the management of American policy is clear. As climate change accelerates, republicans slow the efforts to green the energy system.
Some analysts argue that it was always unrealistic to transform an energy system that fuels factories, fuels cars and heat houses within the short time fixed by the democrats’ climate law, the law on inflation reduction. The tax credits for electric vehicles, for example, have a modification of the fundamentally modified petrol demand, which has remained stable despite an increase in sales of electric vehicles, said Robert McNally, president of Rapidan Energy Group.
At the same time, analysts say that the transition of clean energy is already on the way – with or without financial incentives.
Arjun Murti, a partner of the Verit research company, predicted electric vehicles and zero carbon electricity resources such as solar energy and batteries would continue to grow over the next 30 years, even if deployments do not reach the levels projected in Nets-Zero emission models. The two technologies are mature and increasingly competitive with the resources of fossil fuels, he said.
“The solar batteries plus and electric vehicles are two areas where you are going to get growth with or without tax credits,” said Murti. “People are too pessimistic about these new technologies assuming that they need all financial and tax support.”
“There are good reasons,” he added, “to use them other than climate change.”
Reversing emissions
Mathematics on a warming planet are implacable. The United Nations International Panel on Climate Change said that the risks of extreme time such as floods, drought and forest fires increased whenever the world warms up from a tenth of degree.
The global warming emissions reached a record of 37.5 billion metric tonnes in 2024, according to the Global Carbon Project. The world is six years old at 2024 levels before global temperatures are likely to exceed 1.5 degrees Celsius and 27 years before eclipiding 2 degrees, GCP estimated.
The growth in emissions has slowed down in recent years, but greenhouse gas levels have still increased thanks to a predictable scheme. While emissions in the United States and Europe have fallen, they grew up in developing countries, especially China and India.
These models can change.
There are emerging signs of a structural emission tray in China, where the adoption of electric vehicles is increasing and the country causes large amounts of renewable electricity to complete its massive coal fleet. Indian emissions continue to increase on the back of the increase in coal consumption.
The United States, on the other hand, can be about to retreat.
American emissions have tended to descend for most of the last 15 years, including the first mandate of President Donald Trump, thanks to the combination of cheap natural gas, increasing renewable deployments and demand for stagnant electricity, which led to a wave of coal plantation pensions.
But the demand for electricity is soaring now, in the middle of a boom in artificial and data intelligence centers, encouraging the remaining coal power plants in the United States to operate stronger and to supply the increased demand for natural gas.
Three months are not enough to constitute a trend, but the first quarter of 2025 offers a window of the potential road to come. American emissions increased by 5%, by 62 million tonnes, compared to the first quarter of 2024, according to Carbon Monitor, a tracker of emissions.
Half of this increase was due to the increase in emissions from the electricity sector, the most responsible industry for the drop in American emissions in recent years.
This is the backdrop of the climate for discussions on the Budget Bill of the Republicans. Analysts have said solar energy is by far the best of the United States of the Storm. Even taking into account Trump’s recent rates, Solar is expected to remain economically competitive with gas, analysts said.
But the image is more cloudy for the batteries and downright dark for the wind.
The manufacture of stationary batteries used in the energy sector is dominated by China, which makes them particularly vulnerable to the Trump trade war. Wind projects have already been faced with rental and transmission challenges before Trump took up his duties and the Congress Republicans take an ax for IRA tax credits.
IRA has provided generous subsidies to encourage companies to make components for the energy industries specific to the United States, but strict limits to worrying foreign entities, namely on China, will make it difficult for clean energy manufacturers to claim these credits, said Antoine Vagneur-Jones, responsible for the research of the supply chain in BNEF.
Five years ago, economic and political stars seemed to be aligned for climate action, said McNally, analyst Rapidan. Interest rates were low, which means that the financing of clean energy projects was cheap. The world was not assailed by any major war. And large countries were led by governments prioritizing climate change.
Today, interest rates are high. The wars in Ukraine and the Middle East prompted countries to prioritize energy security and affordability. And populist governments are in power in a large part of the world, said McNally.
“Each of these stars is out,” he said.
Reprinted with E & E News With the permission of politico, LLC. Copyright 2025. E & E News provides essential news to energy and environmental professionals.
