President Donald Trump issued an executive order July 7 targeting renewable energy tax credits as strongly as possible under the One Big Beautiful Bill Act. 

The law accelerates to 2026 the phaseout of the large tax credits created by the Inflation Reduction Act of 2022 in line with Trump’s strong opposition to renewables and support for fossil fuel. He signed it at a July 4 ceremony. (See related story, Trump Signs Big Beautiful Bill into Law on Independence Day.) 

The order, “Ending Market Distorting Subsidies for Unreliable, Foreign-controlled Energy Sources,” directs Treasury Secretary Scott Bessent to determine and then take all actions needed to terminate 45Y and 48E clean energy production and tax credits for wind and solar facilities. 

The OBBBA specifies construction start dates and safe-harbor provisions for the remaining period of eligibility for these tax credits, and Trump’s order directs that these rules not be circumvented by eligibility manipulation. 

Trump also directed prompt implementation of the bill’s enhanced restrictions on foreign entities of concern. And he directed Interior Secretary Doug Burgum to look for and eliminate any codified forms of preferential treatment for wind and solar over dispatchable energy sources. 

The reasons stated in a White House fact sheet are familiar speaking points for Trump and some of his Republican allies: 

• • Wind and solar are unreliable, denigrate the natural beauty of the American landscape and displace dispatchable energy, compromising the grid.
  • Reliance on green subsidies threatens national security by making the U.S. dependent on supply chains controlled by foreign adversaries. 
  • Ending these massive taxpayer subsidies is vital to energy dominance, national security, economic growth and the fiscal health of the country. 

Trump specifies that his order be implemented consistent with applicable laws. However, there may be some room for interpretation of the energy-related provisions of the 870-page OBBBA. 

Investment analysis firm Jefferies in a note to clients earlier July 7 said the House Freedom Caucus sought a strict interpretation by the administration of the “beginning of construction” provisions during negotiations as a condition for support. It said the concern now is whether the Trump administration will attempt to “change the goal posts” for these safe harbor provisions. 

The order directs the Interior and Treasury departments to report back within 45 days on their findings and the actions they have taken or planned.