A wind and solar tax mystery solved

Politico

2 days ago

The sudden emergence of a new wind and solar tax during the debate over Republicans' One Big Beautiful Bill Act was shrouded in mystery.
But some answers are starting to emerge.
The tax, which aimed to penalize wind and solar projects that used parts from China and other U.S. adversaries, popped up in a late June draft of the Senate Finance Committee's portion of the bill. It was panned by the industry and its backers as a 'kill shot' and an attempt to further hobble wind and solar after ending the technologies' tax credits.
Senators removed the tax days later, thanks to a push from some Republican clean energy supporters. But its journey to the bill remained a head-scratcher, with many lawmakers and observers pointing fingers and hazarding guesses about it, and no one taking credit.
'I brought it up at the lunch [soon after the text's release] and leadership had not heard about it,' Sen. John Curtis (R-Utah), a key negotiator pushing to save renewable energy incentives, told our Kelsey Brugger.
'Some members of Finance got surprised when I brought it up.'
Kelsey spoke with lawmakers, congressional aides, lobbyists and others, and pieced together new details about what happened: Finance Committee staff worked and took meetings for more than a year, trying to find a policy to support domestic manufacturing jobs while rolling back the tax incentives in a way that Senate Republicans could support.
The aides came up with the tax after talking with the Joint Committee on Taxation and legislative counsel. But with President Donald Trump's July 4 deadline for passing the bill fast approaching and staff juggling numerous other changes, the committee didn't have time to discuss the ideas broadly and get consensus.
'It was a perfect MacGuffin for the most frenzied point in the process,' said Liam Donovan, a political strategist at the firm Bracewell. He called it a 'reminder to industry that things could get worse.'
Adrian Deveny, founder of Climate Vision and a former top energy aide to Minority Leader Chuck Schumer, said there 'aren't that many tools in the toolbox' if lawmakers want to reshore domestic manufacturing without the tax credits.
'The truth of how a lot of this stuff happens, much of the policy is not requested by a member, it's committee staff, it's not a new phenomenon,' Deveny added.
Senate GOP leadership referred questions to the Finance Committee, which did not return requests for comment.
Nonetheless, there was no shortage of finger-pointing around the excise tax. Prominent fossil fuel supporter Alex Epstein, who had been vocally pushing to end the tax credits quickly, was one person being blamed, but he said he opposed it.
'We don't want to punish solar and wind, but we don't want to give it special preferences,' he said, characterizing his advocacy.
The Solar Energy Manufacturers for America Coalition offered some support for the excise tax — but also wanted to retain the tax credits to incentivize domestic solar production.
But Mike Carr, the group's executive director, said SEMA did not play a role in formulating it. 'The first time we saw the excise tax provision was the same time as everyone else. We didn't provide any input on that provision,' he said.
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