By SUZANNE DOWNING
July 4, 2026 – The wind doesn’t always blow, nor does the sun always shine, but taxpayers always get soaked by subsidies.
The era of open-ended federal tax subsidies for new wind and solar projects came to an end on Saturday, as a key provision of President Donald Trump’s tax legislation took effect, ending eligibility for many future renewable energy developments that are not already under construction.
The deadline stems from the Working Families Tax Cuts Act, signed by President Trump one year ago, which set July 4, 2026, as the cutoff date for new wind and solar projects seeking to qualify for longstanding federal tax credits. Projects that had already begun construction before the deadline generally remain eligible.
The administration has argued that the subsidies have distorted electricity markets while placing a growing burden on taxpayers.
In a video released this week, US Energy Secretary Chris Wright defended the policy change.
“The wind doesn’t always blow, and the sun doesn’t always shine. They drive up the system costs and increase Americans’ electricity prices,” he said.
Federal taxpayers have given over more than $141 billion in subsidies to wind and solar projects between 2010 and 2023 through the federal Investment Tax Credit and Production Tax Credit programs. That exceeds the federal support provided to any other energy source during that period.
The Investment Tax Credit provided developers with a one-time credit based on a percentage of project investment costs, while the Production Tax Credit provides ongoing credits tied to the amount of electricity a facility generates.
Before Congress approved the changes, the Congressional Budget Office estimated the two tax credit programs would increase the federal deficit by roughly $308 billion between 2026 and 2035 if left in place.
The approaching deadline triggered a nationwide scramble among renewable energy developers to begin construction in time to preserve eligibility for the credits. Industry groups acknowledged that the expiration accelerated project schedules across the country as companies raced to qualify before the subsidies ended.
The impact in Alaska is expected to be limited.
Unlike many Lower 48 states, Alaska has seen relatively little utility-scale wind and solar development financed through these federal tax incentives. The state’s electric grid is fragmented, communities are widely dispersed, and much of Alaska’s energy investment has focused on hydroelectric, natural gas, diesel backup systems, and emerging efforts to commercialize North Slope natural gas through the Alaska LNG Project.
One thought on “Trump Administration ends federal wind and solar subsidies, citing cost to taxpayers”
Happy Independence Day! The heavily subsidized wind and solar industries absolutely had to have these subsidies to exist. On top of these subsidies, in many cases, they would lock in take or pay contracts that inflated the cost of electricity for all users. On top of the subsidies and take or pay contracts, utilities had to continue to build reliable dispatchable generation and in many cases operate them at lower less efficient levels that cost the consumer more than they would have otherwise had to pay for on demand electricity.