Republicans in the U.S. House Ways and Means Committee have introduced a new tax plan targeting the rollback of key green energy tax incentives established under President Biden’s Inflation Reduction Act (IRA). The proposal aligns with former President Trump’s “One, Big, Beautiful Bill” and his pledge to reverse the current administration’s climate-focused policies, including withdrawing from the Paris Agreement and dismantling what he referred to as the “Green New Deal.” 

The Republican plan would phase out or eliminate tax credits critical to the U.S. energy transition and carbon neutral strategy. Notably, the $7,500 clean vehicle tax credit would end by 2025—except for manufacturers yet to reach 200,000 unit sales. Credits for previously-owned clean vehicles, large commercial EVs, and residential renewable energy installations (including solar, wind, geothermal, and battery storage) would also be terminated. 

Additional provisions call for phasing out tax incentives for zero-emissions electricity and clean hydrogen starting in 2029, with complete elimination by 2031. These proposed cuts would directly impact sectors vital to achieving U.S. ESG goals and transitioning to a low-carbon economy. 

Critics, including sustainability and clean energy advocacy groups, argue the rollback would undermine innovation and elevate energy costs. Rich Powell, CEO of the Clean Energy Buyers Association, warned, “Eliminating these credits jeopardizes the development of advanced energy technologies needed to meet America’s future electricity demands and climate commitments.” 

The plan signals a broader shift in U.S. climate policy that could slow progress on ESG initiatives and carbon neutrality, especially as industries scale clean energy investments. As political debate intensifies ahead of the 2024 election cycle, the future of America’s green energy incentives—and its leadership in global sustainability—hangs in the balance. 

Sources: 

https://www.esgtoday.com/republicans-launch-plan-to-scrap-biden-era-green-energy-tax-credits/ 

https://apnews.com/article/house-budget-reconciliation-clean-energy-pollution-trump-f8638d3c44e95976b3bf756bc483a8f6  

https://www.reuters.com/sustainability/climate-energy/last-ditch-lobbying-blitz-seeks-save-bidens-clean-energy-tax-credits-2025-05-13/