Solar Tax Credits at Risk: What the One Big Beautiful Bill Act Means for You
What Is the “One Big Beautiful Bill Act” (OBBBA)?
OBBBA sailed through the U.S. House in late May 2025. While pitched as a budget‑balancing move, the bill guts a suite of clean‑energy incentives that have driven record solar adoption.
Key Incentive Changes Under OBBBA
Residential Clean Energy Credit (Section 25D): 30 % tax credit on total system cost. OBBBA repeals this credit for systems placed in service after December 31 2025.
Credits for Leased Residential Systems: Today, third‑party owners can claim the 30 % credit and pass savings to you. OBBBA eliminates this benefit as soon as the bill is signed.
Commercial Investment Tax Credit (ITC): Currently 30 % for qualifying projects (plus possible bonus adders). OBBBA compresses the timeline—projects must start construction within 60 days of enactment and be operational by December 31 2028 to keep the full credit.
Credit Transferability: Developers often sell tax credits to investors to finance projects. OBBBA adds new caps and paperwork, slowing or blocking these transfers.
Foreign Entity of Concern (FEOC) Rules: Beginning January 1 2026, projects that rely on certain foreign‑made components risk total disqualification from federal incentives.
Why It Matters
Sticker Shock: Without the 30 % credit, a typical 10 kW rooftop array in MA jumps from about $32 k → $42 k before state incentives—a loss of roughly $9–10 k in federal savings. (energysage.com)
Jobs on the Line: SEIA projects the repeal of Section 25D alone could cost 75 k–85 k solar jobs by 2026, with total clean‑energy job losses potentially exceeding 250 k by 2028. (utilitydive.com)
Lost Capacity & Reliability Risks: Energy Ventures Analysis estimates 40 + GW of planned clean‑energy capacity faces cancellation or delay under the House bill, slowing grid decarbonization and resilience efforts. (evainc.com)
Timing Is Everything
The Senate could amend or stall OBBBA—but there are no guarantees. Given the tight construction windows written into the bill, delaying your project is a high‑stakes bet.
Key Deadlines if OBBBA passes unchanged
Signing Day (T0): Leased‑system credits vanish.
T0 + 60 days: Last day for commercial projects to “start construction” (permits, interconnection paperwork, or initial payment to EPC).
December 31 2025: Last day for homeowners to place systems in service and still claim 30 %.
January 1 2026: FEOC component ban triggers.
December 31 2028: Drop‑dead date for commercial projects to go live and keep their credits.
What Massachusetts Homeowners Should Know
State‑level incentives (SMART blocks, property‑tax exemption, 6.25 % sales‑tax exemption) remain intact, but only if the federal piece is in place before the install. Missing the 30 % credit dramatically stretches payback periods from ~6 years to 10+.
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