Trump Executive Order Tightens Terms for Solar, Wind Project Credits Under IRA

The U.S. Treasury is set to tighten the definition of the “beginning of construction” for solar and wind projects eligible for Inflation Reduction Act (IRA) credits, following an executive order from Donald Trump. This order, which comes shortly after Trump's "One, Big Beautiful Bill" was signed into law, mandates that the Treasury restrict safe harbour provisions to projects where a substantial portion is built, aiming to prevent manipulation of project eligibility. Additionally, the order calls for the implementation of stricter Foreign Entity of Concern (FEOC) restrictions, primarily targeting China’s involvement in the solar supply chain.

The executive order also instructs the Secretary of the Interior to revise or eliminate policies perceived to prefer wind and solar over other energy sources. The bill, narrowly passed in Congress, has been viewed as a significant move under Trump's presidency, aiming to curb support for renewable energy. Critics argue that this could harm the broader U.S. economy, as solar energy has been a major contributor to meeting rising electricity demand and supporting major corporations, including tech giants.