The One Big Beautiful Bill Act, signed in July, will eliminate the production tax credits for intermittent wind and solar power over the next decade. While wind and solar are widely reported to be the cheapest forms of energy, the industry reports it cannot grow without a steady stream of tax dollars to support it.
In the wake of the signing of the bill, legacy media outlets are cranking out articles warning that electricity prices will increase as a result of allegedly cheap energy generators not being built when that stream of tax dollars ceases. Experts, however, say the models cited in these reports are contradicted by past data showing wind and solar have yet to decrease energy costs.
Temporary government program
The original Production Tax Credit (PTC) was passed in 1992. The goal was to jump-start the wind and solar industry, and once matured, the subsidies would be phased out. Instead, energy analysts Isaac Orr and Mitch Rolling report on their “Energy Bad Boys” Substack, the PTC has been extended 11 times.
The most recent extension in 2021 pushed them out to 2036. The 2022 Inflation Reduction Act based their termination on emission reduction targets that are unlikely to be achieved, according to the Cato Institute, meaning the legislation, signed into law by then-Democrat President Joe Biden, would likely have made them permanent.
Under the One Big Beautiful Bill Act, wind and solar projects are eligible for the PTC if they begin producing electricity by 2027. A loophole inserted into the bill at the last minute allows projects that are “under construction” to receive a four-year safe harbor to continue receiving the PTC.
