Washington, DC – Tuesday, July 1, 2025 – The U.S. Senate passed the One Big Beautiful Bill Act today, preserving several key energy tax incentives that will allow American energy developers to start building the next generation of clean energy technologies. The bill will go to the U.S. House of Representatives with a goal of sending the legislation to President Trump by July 4.
“The private sector needs all tools available, including tax credits and faster permitting, to meet the goals of increasing reliable electricity and lowering costs in an era of rising demand,” said Jeremy Harrell, CEO of ClearPath Action. “The reconciliation process started with calls from some to fully repeal all energy tax incentives, which would have devastated the ability to build new clean energy. Senate Republicans and House allies rejected that approach and preserved some financial tools to accelerate American innovation and invest in American manufacturing. We encourage House Republicans to swiftly pass this bill with the key energy provisions included.”
The Senate-passed bill:
- Retains incentives for technologies like advanced nuclear, geothermal, hydropower and storage through 2032, and continues solar and wind incentives through 2027 to avoid stranding capital for projects currently in the pipeline;
- Preserves transferability provisions for the life of each energy credit;
- Creates parity in the 45Q carbon sequestration credit for all types of carbon use and storage, including enhanced oil recovery;
- Retains the 45X advanced manufacturing incentive to support domestic production of critical minerals and certain energy components;
- Provides a path for American energy producers to meet growing demand and shift supply chains away from foreign entities of concern, like China; and
- Provides new financing authority for the Loan Programs Office to support reliable energy technologies like nuclear, and geothermal and energy supply chains.
“Going forward, Congress will also need to improve the federal permitting process and continue to advance innovation policy in a bipartisan, politically durable way, to ensure domestic supply meets rapidly growing demand and compete globally. Even with these incentives in place, developers must be able to obtain a permit to build much quicker than they can today,” added Harrell.
More detailed specifics of some key provisions in the bill passed by the Senate today include:
- 45Y and 48E credits to support clean baseload energy
- Allows all technologies (other than solar and wind) to commence construction through the end of 2032, followed by a three-year phasedown.
- Requires solar and wind projects to commence construction by the end of 2027.
- Creates new “nuclear energy communities” bonus for nuclear projects under 45Y.
- 45X credit to support American manufacturing
- Continued support for critical minerals production through 2030.
- 45Q credit to support carbon dioxide sequestration
- Equalizes the credit value for utilization, including EOR.
- Adjusts for inflation sooner, partially undoing a five-year delay imposed by the IRA.
- Foreign Entities of Concern Provisions
- Includes strict FEOC provisions to ensure taxpayers are not subsidizing projects linked to China and other hostile foreign actors.
- Grandfathers in existing contracts and provides an orderly phase-in of new requirements pending Treasury guidance.
- Transferability Provisions
- Preserves transferability for all credits consistent with current law, allowing companies to efficiently monetize tax credits.
- Adds new restrictions that the recipients must comply with FEOC.
- U.S. Department of Energy’s Loan Program Office Provisions
- Includes $1 billion in new “Energy Dominance” financing that will allow LPO to support projects that provide grid reliability or unlock critical minerals, including new nuclear and geothermal projects.
- Extends some existing LPO programs from 2026 to 2028.
Media Contact:
Emily Johnson
emily@clearpathaction.org
(678) 761-1864
ABOUT CLEARPATH ACTION
ClearPath Action 501(c)(4) advocates for more clean energy innovation, modernized permitting and regulatory reform, America’s global competitiveness for manufacturing, and unlocking more American resources — solutions drawn from our friends at ClearPath. Learn more at clearpathaction.org. Follow us on X: @ClearPathAction, @jharrell
