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Struggling developers will likely be able to write off subsea cables, as a treat.
The beleaguered offshore wind industry got a small boost from the Biden administration on Friday in the form of a proposal that would expand the definition of what qualifies for a 30% clean energy investment tax credit.
Offshore wind farms have many different components beyond just the turbines, and developers have been seeking clarity on where the dividing line was between the equipment that would qualify for the tax credit, and any interdependent infrastructure like transformers and transmission lines. Under the new rules, developers would be able to include the cost of subsea cables that bring the power to shore, as well as onshore substations — not just the towers and blades or the platforms they sit on.
The proposal is part of the Treasury’s ongoing role in overseeing a range of expanded tax credits for clean energy that were in the Inflation Reduction Act. It provides similar clarity for a new tax credit for standalone, utility-scale energy storage projects, which can store power from wind and solar farms and dispatch it when needed.
“Given the new and expanded incentives created by the Inflation Reduction Act, clarity around the underlying rules for long-standing investment credits is critical as projects move from the announcement, to groundbreaking, and eventual ribbon-cutting stage,” said Wally Adeyomo, deputy secretary of the Treasury, during a call with reporters on Thursday.
John Podesta, senior advisor to Biden for clean energy innovation and implementation, who was also on the call, said that developers were hearing from their lenders that they were waiting to see the final tax credit guidance, particularly in regard to underwater cabling. Offshore wind projects have been plagued by rising costs due to inflation, supply chain disruptions, and rising interest rates. Many have asked the future buyers of their power to approve higher rates, and two projects in New Jersey were recently canceled altogether.
In July, a utility in Rhode Island decided not to move forward on a contract to buy power from a proposed offshore wind farm called Revolution II, a joint venture between Orsted and Eversource, putting the project in limbo. In a press release, the utility pointed to “uncertainty of federal tax credits” as one of the factors that likely contributed to the higher-than-expected proposed contract.
Adeyomo said the clarity provided by the tax credit rules will “allow these offshore wind companies to price their offerings going forward with the certainty to know what types of incentives they will receive from the government.”
“We appreciate the clarification from the Treasury Department that recognizes the integral nature of all components of an offshore wind project,” a spokesperson for Orsted told me.
Considering the broader economic headwinds these projects face, this expansion of the tax credit eligibility is unlikely to be enough to put the ailing industry on solid ground. Offshore wind developers are also still waiting for clarity on another Inflation Reduction Act program that could prove essential — the energy community bonus credit. The subsidy gives projects an additional 10% tax credit if they build in communities that have been host to fossil fuel plants or extractive activities. It will apply to the location of onshore substations, but developers want to see it also apply to port infrastructure.
Clean energy trade groups welcomed the proposal on Friday.
“Thanks to the IRA, clean energy businesses now have access to a stable tax platform like the one enjoyed by the fossil fuel sector for more than a century,” said Gregory Wetstone, President and CEO of the American Council on Renewable Energy in a statement. “But to fully take advantage of these benefits, they need to understand how the provisions work. The tax guidance released today provides important clarity to developers and investors looking to further America’s energy transition.”
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A judge has lifted the administration’s stop-work order against Revolution Wind.
A federal court has lifted the Trump administration’s order to halt construction on the Revolution Wind farm off the coast of New England. The decision marks the renewables industry’s first major legal victory against a federal war on offshore wind.
The Interior Department ordered Orsted — the Danish company developing Revolution Wind — to halt construction of Revolution Wind on August 22, asserting in a one-page letter that it was “seeking to address concerns related to the protection of national security interests of the United States and prevention of interference with reasonable uses of the exclusive economic zone, the high seas, and the territorial seas.”
In a two-page ruling issued Monday, U.S. District Judge Royce Lamberth found that Orsted would presumably win its legal challenge against the stop work order, and that the company is “likely to suffer irreparable harm in the absence of an injunction,” which led him to lift the dictate from the Trump administration.
Orsted previously claimed in legal filings that delays from the stop work order could put the entire project in jeopardy by pushing its timeline beyond the terms of existing power purchase agreements, and that the company installing cable for the project only had a few months left to work on Revolution Wind before it had to move onto other client obligations through mid-2028. The company has also argued that the Trump administration is deliberately mischaracterizing discussions between the federal government and the company that took place before the project was fully approved.
It’s still unclear at this moment whether the Trump administration will appeal the decision. We’re still waiting on the outcome of a separate legal challenge brought by Democrat-controlled states against Trump’s anti-wind Day One executive order.
A new letter sent Friday asks for reams of documentation on developers’ compliance with the Bald and Golden Eagle Protection Act.
The Fish and Wildlife Service is sending letters to wind developers across the U.S. asking for volumes of records about eagle deaths, indicating an imminent crackdown on wind farms in the name of bird protection laws.
The Service on Friday sent developers a request for records related to their permits under the Bald and Golden Eagle Protection Act, which compels companies to obtain permission for “incidental take,” i.e. the documented disturbance of eagle species protected under the statute, whether said disturbance happens by accident or by happenstance due to the migration of the species. Developers who received the letter — a copy of which was reviewed by Heatmap — must provide a laundry list of documents to the Service within 30 days, including “information collected on each dead or injured eagle discovered.” The Service did not immediately respond to a request for comment.
These letters represent the rapid execution of an announcement made just a week ago by Interior Secretary Doug Burgum, who released a memo directing department staff to increase enforcement of the Bald and Golden Eagle Protection Act “to ensure that our national bird is not sacrificed for unreliable wind facilities.” The memo stated that all permitted wind facilities would receive records requests related to the eagle law by August 11 — so, based on what we’ve now seen and confirmed, they’re definitely doing that.
There’s cause for wind developers, renewables advocates, and climate activists to be alarmed here given the expanding horizon of enforcement of wildlife statutes, which have become a weapon for the administration against zero-carbon energy generation.
The August 4 memo directed the Service to refer “violations” of the Bald and Golden Eagle Protection Act to the agency solicitor’s office, with potential further referral to the Justice Department for criminal or civil charges. Violating this particular law can result in a fine of at least $100,000 per infraction, a year in prison, or both, and penalties increase if a company, organization, or individual breaks the law more than once. It’s worth noting at this point that according to FWS’s data, oil pits historically kill far more birds per year than wind turbines.
In a statement to Heatmap News, the American Clean Power Association defended the existing federal framework around protecting eagles from wind turbines, noted the nation’s bald eagle population has risen significantly overall in the past two decades, and claimed golden eagle populations are “stable, at the same time wind energy has been growing.”
“This is clear evidence that strong protections and reasonable permitting rules work. Wind and eagles are successfully co-existing,” ACP spokesperson Jason Ryan said.
The $7 billion program had been the only part of the Greenhouse Gas Reduction Fund not targeted for elimination by the Trump administration.
The Environmental Protection Agency plans to cancel grants awarded from the $7 billion Solar for All program, the final surviving grants from the Greenhouse Gas Reduction Fund, by the end of this week, The New York Times is reporting. Two sources also told the same to Heatmap.
Solar for All awarded funds to 60 nonprofits, tribes, state energy offices, and municipalities to deliver the benefits of solar energy — namely, utility bill savings — to low-income communities. Some of the programs are focused on rooftop solar, while others are building community solar, which enable residents that don’t own their homes to access cheaper power.
The EPA is drafting termination letters to all 60 grantees, the Times reported. An EPA spokesperson equivocated in response to emailed questions from Heatmap about the fate of the program. “With the passage of the One Big Beautiful Bill, EPA is working to ensure Congressional intent is fully implemented in accordance with the law,” the person said.
Although Solar for All was one of the programs affected by the Trump administration’s initial freeze on Inflation Reduction Act funding, EPA had resumed processing payments for recipients after a federal judge placed an injunction on the pause. But in mid-March, the EPA Office of the Inspector General announced its intent to audit Solar for All. The results of that audit have not yet been published.
The Solar for All grants are a subset of the $27 billion Greenhouse Gas Reduction Fund, most of which had been designated to set up a series of green lending programs. In March, Administrator Lee Zeldin accused the program of fraud, waste, and abuse — the so-called “gold bar” scandal — and attempted to claw back all $20 billion. Recipients of that funding are fighting the termination in an ongoing court case.
State attorneys generals are likely to challenge the Solar for All terminations in court, should they go through, a source familiar with the state programs told me.
All $7 billion under the program has been obligated to grantees, but the money is not yet fully out the door, as recipients must request reimbursements from the EPA as they spend down their grants. Very little has been spent so far, as many grantees opted to use the first year of the five-year program as a planning period.