Opinion Piece: The Enormous Flamboyant Bill may cause severe harm to New Mexico's renewable energy sector
The Senate's latest bill, known as the Big Beautiful Bill (BBB), has raised concerns in New Mexico's renewable energy sector. If passed, the BBB could significantly impact the state's thriving renewable energy industry, which has benefited greatly from supportive federal policies.
At the heart of the controversy is the proposed elimination of several key tax credits. These include the Clean Energy Production Tax Credit (Section 45Y), the Advanced Manufacturing Tax Credit (Section 48E), and credits that incentivize rooftop solar and household electrification. The elimination of these credits, due to take effect after 2027, could remove critical financial support that underpinned much of recent renewable investment and manufacturing growth.
Moreover, the BBB introduces a new excise tax on wind and solar projects placed in service after 2027. This tax, estimated to raise project costs by 10-20% and consumer energy prices by 8-10%, could significantly dampen project economics and deter new developments.
The BBB also imposes supply chain restrictions, penalising projects unless they completely disentangle supply chains from prohibited foreign entities, such as China. This added complexity and cost in sourcing materials and manufacturing components domestically could further hinder the growth of the renewable energy industry.
The potential elimination of these tax credits and the new excise taxes could increase costs, reduce investment incentives, slow project development, and threaten jobs in clean energy manufacturing and deployment. This could undermine New Mexico's clean energy transition goals, hinder innovation, and potentially increase reliance on fossil fuels or foreign energy imports.
Given New Mexico's reliance on energy production, the BBB could have significant implications for job creation, entrepreneurship opportunities, and local and state government economies. The state's renewable energy sector has been a key driver of growth, contributing to job creation, fostering entrepreneurship, and bolstering local and state economies.
For those with general questions or concerns, the website [web@our website] is available for more information. It is crucial for stakeholders to stay informed and engage in the political process to ensure the continued growth and sustainability of New Mexico's renewable energy industry.
- The elimination of key tax credits like the Clean Energy Production Tax Credit, the Advanced Manufacturing Tax Credit, and credits for rooftop solar and household electrification, proposed in the Big Beautiful Bill (BBB), could remove significant financial support from the renewable energy industry, potentially undermining its growth and prosperity.
- The BBB's new excise tax on wind and solar projects, which could add 10-20% to project costs and increase consumer energy prices by 8-10%, could significantly impact the economy of renewable energy projects and discourage new developments.
- The BBB's supply chain restrictions, which penalize projects for using materials or components from prohibited foreign entities, could increase costs and complexity in sourcing materials and manufacturing components domestically, potentially hindering the growth of the renewable energy industry.
