Environmental and renewable energy groups sue IRS, Treasury

A coalition of renewable vitality stakeholders have sued the Inner Income Service and the Dept. of the Treasury for modifications to tax credit that the group alleges are discriminating towards photo voltaic and wind vitality tasks. The teams are led by the Oregon Environmental Council, and embody the Pure Sources Protection Council (NRDC), Public Citizen, Hopi Utilities Company, Woven Vitality, the town and county of San Francisco and the Maryland Workplace of Individuals’s Counsel.

“The Trump administration has undertaken an illogical and unlawful struggle on clear vitality, and these arbitrary tax guidelines are simply one other salvo,” mentioned Grace Henley, a tax legal professional at NRDC, in a press release. “That is dangerous for clear vitality, dangerous for employees and communities, dangerous for the air all of us breathe, and horrible for People squeezed by increased utility payments.”

The lawsuit considerations an executive order issued by President Donald Trump following passage of the One Massive Stunning Invoice Act (OBBBA) in July that eliminated a protected harbor clause particularly for photo voltaic and wind tasks. Protected harbor lets tasks eligible for tax credit nonetheless qualify for the subsidies in the event that they full a longtime proportion of the challenge earlier than a deadline.

The coalition is claiming that the IRS’s elimination of the 5% protected harbor for wind and photo voltaic tasks 1.5 MW and bigger was unlawful. This elimination of language might forestall photo voltaic tasks from receiving the 30% federal funding tax credit score earlier than it expires on July 4, 2026.

“These new IRS guidelines have been a harsh blow. We’ve been relying on new photo voltaic tasks to get electrical energy to these with out it, assist assist important companies and to create and supply jobs,” mentioned Tim Nuvangyaoma, former chairman of the Hopi Tribe. “The steering has compelled us to alter our plans, and the Hopi Utilities Company is now racing to qualify for tax credit beneath the brand new pointers. Getting the court docket to rectify this unjust motion would give us the knowledge we’d like.”