Trump’s July 4 Victory Comes at Renewable Energy’s Expense

As President Donald Trump signed his landmark legislation on Independence Day — a bill he’s branded “One Big Beautiful Bill” — the renewable energy sector is bracing for what many are calling a policy gut punch.

Touted as a sweeping package of tax cuts and spending rollbacks, the bill’s most consequential target is the green energy industry, which now faces the rollback of the very federal support that helped it scale. Chief among the changes is the rapid phase-out of long-standing federal tax credits that enabled developers of solar and wind projects to recoup 30% or more of their project costs. These incentives — once essential to the industry’s expansion across rural and industrial America — will now vanish in a matter of months.

The Joint Committee on Taxation projects that axing this green credit alone will “save” the government $165 billion over the next decade. The total projected savings under Chapter 5 of the bill — dubbed the “Green New Deal Repeal” section — exceed half a trillion dollars, making it one of the bill’s largest cost-cutting components.

Fossil Fuel Revival

But the legislation doesn’t just phase out subsidies. It tilts the playing field decisively back toward fossil fuels.

The bill opens vast new areas of federal land to oil and gas leasing and lowers royalty rates for drilling, reviving incentives that had been curbed in past administrations. It also calls for a full-scale replenishment of the Strategic Petroleum Reserve, a move the White House says will ensure “American energy dominance” in the event of global supply disruptions.

Trump’s legislation also introduces a new tax break aimed at domestic production of metallurgical coal — used in steelmaking — by reclassifying it as a “strategic mineral.” The new designation will allow companies to benefit from preferential tax treatment and easier permitting rules, signaling a return to coal not just as a legacy fuel, but as a critical industrial resource.

Meanwhile, electric vehicles take a hit. The bill eliminates federal tax credits for EV buyers, a change likely to ripple through the auto industry just as major manufacturers were ramping up U.S.-based EV production to meet future demand.

A Near Miss for Solar and Wind

The final text of the bill could have been even harsher. A proposed 20% excise tax on wind and solar projects that use Chinese-made components — which would have added steep costs to projects across the country — was ultimately scrapped during last-minute negotiations. Senate Republican leaders reportedly dropped the provision to avoid fracturing industry support in GOP-led states where wind and solar provide jobs and local tax revenue.

Still, the damage is significant. Industry analysts warn that without the federal Investment Tax Credit (ITC) and Production Tax Credit (PTC), many renewable energy projects may stall or be canceled altogether. With financing costs already high and project pipelines dependent on predictability, the sudden policy reversal could put thousands of jobs at risk and dry up billions in private-sector investment.

While the administration celebrates the bill as a win for taxpayers and “American energy independence,” clean energy advocates say it sends a stark message that Washington is backing away from decarbonization.

Environmental groups have accused Trump of engineering a regulatory bonanza for oil and coal interests at the expense of the planet.

But for Trump and congressional Republicans, the bill marks a defining legislative achievement — a sweeping repudiation of Biden-era climate priorities and the latest move in a broader strategy to reassert fossil fuel dominance as a national strength.

“We will drill, baby, drill,” Trump said during his inauguration speech. “We will be a rich nation again and it is the liquid gold under our feet that will help us do it.”

The question now is how quickly the renewable sector can adapt — or whether it can survive the political headwinds at all.