Wind and solar incentives face rollback under GOP proposal. (Photo: iStock)
House Republicans introduced a tax reform proposal that would reduce tax incentives for low-carbon industries such as wind, solar, hydrogen, and electric vehicles (EVs) on May 13. However, the cuts are set to be phased in gradually—less aggressively than markets had anticipated—prompting a surge in renewable energy stocks in both the U.S. and Europe.
Gradual phase-out of clean energy tax breaks
According to the draft plan, the current federal tax credit of up to $7,500 for EV buyers will be fully eliminated by the end of 2026. Tax breaks for commercial EVs and used EVs would also be scrapped. These changes are expected to impact not only EV demand but also battery manufacturing and lithium supply chains.
