The US is entering a new phase in renewable energy policy as federal tax credit changes establish tighter timelines for wind and solar projects, placing greater importance on completion deadlines, project eligibility and compliance with supply chain requirements. The changes are reshaping the policy framework for wind and solar development in the country, says GlobalData, a leading intelligence and productivity platform.
GlobalData’s latest report, “North and South America Renewable Energy Policy Handbook 2026,” reveals that the One Big Beautiful Bill Act makes the timing of construction and project completion key considerations for developers seeking to qualify for incentives. Enacted in July 2025, the legislation introduced termination provisions for the Section 45Y Clean Electricity Production Credit and Section 48E Clean Electricity Investment Credit for applicable wind and solar facilities placed in service after December 31, 2027, subject to statutory exceptions.
Mohammed Ziauddin, Power Analyst at GlobalData, comments: “The changes to US clean electricity tax credits mark an important shift in the policy environment for wind and solar. With the initial transition window now closed, developers must assess their remaining project timelines, construction milestones and eligibility requirements against the applicable statutory deadlines. The distinction between projects that qualified under the applicable transition provisions and those that did not is now central to investment and development decisions.”
A defining feature of the revised framework is the distinction between the deadline for beginning construction and the deadline for placing a project in service. Now that the July 4, 2026 window to satisfy beginning of construction requirements under the statutory transition provisions has passed, the primary remaining milestone for non-exempt projects is the December 31, 2027 placed in-service cutoff.
Ziauddin adds: “Under the legislation, applicable wind and solar facilities that did not qualify for transition relief must be placed in service by December 31, 2027, to remain eligible for the relevant Section 45Y or Section 48E credit. Meanwhile, facilities that met the beginning of construction requirements by the July 4, 2026 deadline remain eligible under the transition provisions, subject to ongoing completion and continuity conditions. These rules make it critical to distinguish the date on which construction began from the date on which a facility becomes operational.”
The policy changes also affect the requirements that developers must consider when establishing eligibility. In February 2026, the US Treasury Department and the Internal Revenue Service (IRS) issued guidance on restrictions concerning material assistance from prohibited foreign entities. These restrictions apply to certain clean electricity facilities and energy storage technologies, with the relevant rules depending on factors including construction commencement and the applicable tax credit provisions.
The IRS has also published guidance on the statutory termination of the wind and solar credits. The implementation of these requirements means that project qualification involves both timing considerations and compliance with applicable ownership, sourcing, and material assistance rules.
Ziauddin continues: “The revised federal framework also needs to be considered alongside state-level renewable energy policies. Renewable portfolio standards, clean electricity requirements, and state procurement programs continue to form part of the policy landscape for renewable energy development. These measures operate through different regulatory and procurement mechanisms and should be distinguished from federal tax credits, whose eligibility conditions are established under federal law.”
The implications of the federal changes are specific to the US and should not be interpreted as a region-wide change in renewable energy tax policy. Canada, Mexico and countries in South America operate under their own legislative, regulatory and incentive frameworks. The US policy changes therefore represent a national development within the wider Americas renewable energy policy landscape rather than a common regional deadline for wind and solar projects.
Ziauddin concludes: “The direction of US wind and solar policy is increasingly defined by statutory eligibility conditions, construction milestones, and supply chain compliance. For developers, understanding the interaction between federal tax provisions and state-level policy frameworks is essential when assessing project eligibility. The policy framework also highlights why developments in the US need to be evaluated separately from the renewable energy support mechanisms operating elsewhere across the Americas.”
