The Senate version of the "Big Beautiful" bill is more radical, and the U.S. solar and wind industries are facing a "survival crisis."

As Republican senators in the United States debate Trump's tax and spending bill, renewable energy companies are facing the industry's "worst-case scenario."

According to media reports on July 1, the latest version of the "Great Beautiful Act" being debated by Senate Republicans introduces two key changes: a new consumption tax on wind and solar projects that use specific imported components; and a significant advancement of the deadline for clean energy projects to qualify for the Clean Electricity Tax Credit to the end of 2027.

Contrary to market expectations that the Senate would relax the subsidy phase-out timeline, the latest version requires wind and solar projects to be fully operational by the end of 2027 to receive incentives, which is more aggressive than the timeline in the House version.

These changes have caught the renewable energy industry off guard and are seen as a "survival crisis" for the sector. Ben King, deputy director of the energy and climate practice at the Rhodium Group, stated that these measures are "completely unexpected" and have shocked the industry.

Jason Grumet, CEO of the American Clean Power Association (ACP), bluntly stated that the Senate's policy changes will "significantly increase energy costs for its constituents and sacrifice tremendous job growth," placing "political debate above the actual interests of voters."

According to ACP estimates, the new consumption tax will add $4 billion to $7 billion in costs for U.S. clean energy companies over the next decade. Rhodium Group predicts this will lead to a 10% to 20% increase in the construction costs of wind and solar projects.

Ben King analyzed that this significant rise in costs will "suppress project deployment," causing new solar and wind projects that could economically compete with natural gas to lose their advantage, while unprecedented policy uncertainty will create a "chilling effect" on renewable energy investment. The ACP further estimates that the current proposal will ultimately hinder 300 gigawatts (GW) of wind and solar projects from connecting to the grid over the next 15 years, with Grumet calling this a "dramatic disruption" to grid expansion during a time of soaring demand. Media reports indicate that natural gas generation is struggling to fill the gap due to turbine shortages, while nuclear power plant construction takes years.

Strong Opposition from Multiple Parties, Amendment Efforts Launched

The concerns raised by the bill extend far beyond the industry itself. Tesla CEO Elon Musk criticized the bill on his social media platform X as "political suicide" for the Republicans, stating its energy impact is "extremely crazy and destructive." Labor organizations have also fiercely criticized its potential impact on jobs, with North America's Building Trades Unions President Sean McGarvey even calling the legislation "the largest job-killing bill in American history."

Media reports indicate that some senators are already working to push amendments to mitigate the impact. Republican senators Joni Ernst, Chuck Grassley, and Lisa Murkowski are advancing an amendment on Monday aimed at softening the phase-out timeline for the Clean Electricity Tax Credit and eliminating the proposed consumption taxAnalysts at the research firm Capstone stated in a report that the consumption tax is "unprecedented," and "the extremity of the proposal may prompt key senators to support the repeal of the consumption tax."

However, the direction of the policy remains unclear. If the current version of the bill is passed, Ben King believes it will mark a "real setback" for the U.S. energy transition and that the "carbon neutrality process will essentially come to a standstill" from that point onward