President Donald Trump has issued an executive order that significantly restricts the eligibility criteria for wind and solar projects to claim federal tax credits. The directive, issued in connection with the One Big Beautiful Bill Act, tasks the Treasury Department with enforcing stricter rules on how and when projects can qualify.
Under the order, only projects that begin construction within the next year will be eligible for tax relief. To assess whether construction has genuinely started, the Treasury is instructed to narrow the use of “broad safe harbours” unless a significant portion of the facility has already been physically built. This signals a shift away from the previous interpretation, where planning milestones and limited onsite work could be sufficient for qualification.
The executive order also instructs the Treasury to guard against what it terms the “artificial acceleration or manipulation of eligibility.” This implies a crackdown on developers using legal timing strategies or financial structuring to meet the tax credit deadlines without meaningful progress on the ground.
In addition, the Department of the Interior has been directed to review and potentially roll back any existing policies that provide the wind and solar sectors with what the administration considers “preferential treatment.”
