Clean Energy Subsidies in US Senate Bill Spark Bácklash from Labour, Business Groups

The US Senate’s proposal to slash clean energy subsidies and impose a new tax on wind and solar projects—part of its version of President Donald Trump’s tax and spending bill—has triggered strong criticism from labour unions and business leaders, who warn the changes could drive up electricity prices, cause power shortages, and eliminate jobs.

Unveiled over the weekend, the draft bill has drawn attention from across the political and economic spectrum as senators began voting on amendments Monday morning.

The vote marks one of the last opportunities for renewable energy advocates to lobby for changes before the bill advances.

“Taxing energy production is never good policy, whether oil & gas or, in this case, renewables,” said Neil Bradley, policy director of the US Chamber of Commerce, in a post on X.

“Electricity demand is set to see enormous growth & this tax will increase prices. It should be removed.”

Tesla CEO Elon Musk, a vocal ally of Trump, also criticised the legislation, warning it could disrupt the development of energy-intensive technologies like artificial intelligence. “This would be incredibly destructive to America!” Musk posted on X.

President Trump has pledged to ramp up domestic energy production, prioritising fossil fuels to support industries like AI.

He has also vowed to eliminate renewable energy subsidies—a commitment reflected in the Senate bill’s rollback of incentives for wind, solar, battery storage, and other clean technologies created under President Joe Biden’s 2022 Inflation Reduction Act.

In addition to slashing subsidies, the bill proposes a new tax on renewable energy projects that fail to prove their components are free of Chinese parts—a provision stricter than previous Senate or House versions.

Energy Secretary Chris Wright dismissed concerns about reduced generation capacity amid rising demand, claiming the bill would boost reliability by ending support for intermittent power sources.

“The more we load our grid with intermittent generation, the worse the grid performs during times of maximum demand,” Wright wrote on X.

“The One Big Beautiful Bill will help end wasteful subsidies and deliver more reliable energy for the American people.”

However, in contrast to Wright’s position, Texas grid operator ERCOT reported at its Board of Directors meeting last week that the state’s power system is “ready for the challenges of extreme weather” this summer—crediting the stability to new large-scale solar and battery installations that have recently come online. [CONTINUE READING HERE]>>>