Stop the Subsidized Green Energy Scam Act

Bill Number

H.R. 4118

Origin Chamber

House

Congress

119th Congress, Session 1

Policy Area

Taxation

Status

Introduced

Latest Action

2025-06-24: Referred to the House Committee on Ways and Means.

Last Updated

2025-07-17T18:56:20Z

AI-Generated Summary

Purpose of the Legislation

This bill, titled the "Stop the Subsidized Green Energy Scam Act," aims to end specific federal tax incentives for new wind, solar, and battery energy storage projects. It seeks to eliminate subsidies that encourage the development of these renewable energy technologies by removing tax credits available under the Internal Revenue Code (IRC), which is the main U.S. tax law.

Key Provisions

• Termination of Energy Credit (Section 48 of the IRC): Excludes facilities that use wind, solar energy, or battery storage to generate, store, or deliver electricity if construction begins after the bill's enactment. This credit previously supported investments in energy-producing equipment.
• Termination of Clean Electricity Production Tax Credit (Section 45Y of the IRC): Redefines "qualified facility" to exclude wind, solar, or battery storage projects starting construction after enactment. It also makes conforming changes to related rules, such as phase-out provisions.
• Termination of Clean Electricity Investment Tax Credit (Section 48E of the IRC): Similarly excludes qualifying facilities using wind, solar, or battery storage if construction begins post-enactment.
• Effective Date: Applies to any property where construction starts after the date the bill becomes law.
• Implementation: Directs the Secretary of the Treasury, in consultation with the Secretary of Energy, to issue regulations or guidance as needed to enforce these changes.

Significant Changes to Existing Law

The bill introduces targeted exclusions to three major tax credits established or expanded under prior laws like the Inflation Reduction Act of 2022. Previously, these credits provided financial benefits—such as dollar-for-dollar reductions in tax liability—to encourage investment and production in clean energy. The changes limit eligibility strictly to pre-enactment projects, effectively halting new subsidies for the specified technologies without altering credits for other energy sources (e.g., geothermal or hydropower). This creates a cutoff based on construction start dates, a common mechanism in tax law to phase out incentives.

Potential Impacts

• On Government Agencies: The Treasury Department and Internal Revenue Service will need to update tax forms, guidance, and enforcement processes, potentially increasing administrative workload. The Department of Energy may provide input on technical aspects but faces no direct new duties.
• On Citizens: Taxpayers funding these subsidies (through reduced government revenue) may see indirect benefits via lower federal spending on incentives. However, energy consumers could face higher electricity costs if renewable energy development slows, as these projects often contribute to grid reliability and price stability.
• On International Relations: Could signal a U.S. shift away from aggressive renewable energy promotion, potentially straining relations with allies committed to global climate goals (e.g., under the Paris Agreement). It might also affect trade in solar panels or batteries, as reduced domestic demand could impact international supply chains.

Main Stakeholders Affected

• Renewable Energy Developers and Companies: Wind, solar, and battery storage firms will lose key financial incentives for new projects, potentially delaying expansions or increasing costs.
• Investors and Financial Institutions: Those funding green energy will face reduced returns on post-enactment investments due to the credit eliminations.
• Taxpayers and General Public: Benefit from ending subsidies but may experience broader economic effects, such as job losses in renewable sectors (estimated at hundreds of thousands nationwide).
• Traditional Energy Producers: Indirectly favored, as the bill removes competitive advantages for renewables without touching fossil fuel subsidies.
• Environmental Groups: Likely opposed, as it could hinder progress toward reducing carbon emissions.

Notable Legal, Constitutional, or Political Implications

• Legal: The amendments are straightforward tax code changes, relying on Congress's broad authority to modify incentives. No challenges to enforceability are evident, though disputes over "construction start date" definitions could arise in tax courts.
• Constitutional: Aligns with Article I's grant of taxing and spending powers to Congress; no apparent free speech, property rights, or equal protection issues, as it treats similar facilities uniformly based on technology type.
• Political: The bill's provocative title suggests a partisan critique of green energy policies, potentially fueling debates on climate action versus fiscal conservatism. If passed, it could influence midterm elections or future energy legislation by highlighting divides on subsidies.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. Williams, Roger [R-TX-25]

Recent Actions

• 2025-06-24: Referred to the House Committee on Ways and Means.
• 2025-06-24: Introduced in House
• 2025-06-24: Introduced in House

Bill Versions

• Stop the Subsidized Green Energy Scam Act — issued 2025-06-24 — PDF (3 pages)