Trump Signs “One Big Beautiful Bill” OBBBA: What It Means for the Solar Tax Credit

On July 3, 2025, the President Trump signed the sweeping “One Big Beautiful Bill” (OBBBA), marking a major shift in clean energy policy that will have far-reaching consequences for solar customers, installers, and the industry as a whole.

While the bill dropped some of its most controversial provisions, such as an excise tax on imported solar equipment, it still accelerates the rollback of the solar tax credit (or Investment Tax Credit, ITC), a cornerstone of America’s clean energy transition.

In this post, we break down what OBBBA changes, how it affects homeowners and the solar industry, and why it’s more urgent than ever to install solar and battery backup systems before the tax credit disappears.

What the OBBBA Changes for Solar Tax Credits

Faster Phase-Out of the Solar Tax Credit

One of the most significant impacts of OBBBA is the accelerated phase-out of the federal solar tax credit. For residential systems (Section 25D), the 30% credit will expire on December 31, 2025. For commercial and utility-scale projects (Section 48), projects must either begin construction within 12 months of the bills passage, or be placed in service by the end of 2027 to qualify for the full credit. After that:

• Commercial projects placed in service in 2027 qualify for only 60% of the credit.
• Commercial projects in 2028 receive 20%.
• Starting in 2029, the credit is eliminated entirely.

This aggressive schedule dramatically shortens the window for homeowners and businesses to take full advantage of the 30% incentive that has fueled solar growth over the past decade.

Battery Backup, Energy Storage Tax Credit Eliminated

Another key change: OBBBA eliminates the tax credit for battery backup (energy storage) systems whether installed solar or not. The solar tax credit was expanded to include battery backup systems in the 2022 Inflation Reduction Act, but the OBBBA rolls back this expansion. Homeowners must now install battery backup with or without solar by Dec. 31, 2025, to take advantage of the tax credit on their energy storage system. This removes a critical financing pathway that has made solar accessible for lower- and middle-income households.

While battery backup/energy storage tax credit is in jeopardy, the economics of installing both solar and battery together still have many advantages. Homeowners should consider installing both solar and battery systems now to take full advantage of the combined incentives before they expire.

Excise Tax Removed, but Damage Done

Although the bill originally included a steep excise tax on imported solar modules and other equipment, this provision was stripped from the final Senate version. While this removal eases some pressure on the supply chain, the accelerated phase-out of credits is still expected to lead to widespread project cancellations and reduced industry investment.

What This Means for Homeowners Considering Solar or Battery Backup

Time is Running Out to Secure the 30% Tax Credit

The message is clear: If you’re thinking about going solar or adding battery backup, you need to act now. Systems must be installed and operational by the end of 2025 to qualify for the full residential solar tax credit. With permitting and utility interconnection often taking months, starting the process immediately is critical. Homeowners who delay will either pay significantly more out-of-pocket or may find solar financially out of reach.

Contact Green Ridge Solar today for your solar quote and learn how much you could save with solar. We will also track down every solar and battery incentive you qualify for.

Significant Financial Impact

Losing the 30% solar tax credit can add thousands of dollars to your out-of-pocket costs. A $25,000 solar system today would be eligible for a $7,500 tax credit. After 2025, that benefit disappears entirely for homeowners. This added cost can create a significant barrier to installing solar and finding relief from increasing energy bills. This is especially true of middle- and low-income households who are most impacted by energy price inflation and utility price hikes.

Don’t wait until the solar tax credit is expires. Get your solar quote today and slash your energy bills with solar.

Installation Timelines are Limited

Permits, utility approvals, and equipment availability can all take several months when preparing for a solar panel installation. To qualify for the solar tax credit, your system must be installed and operational by December 31, 2025. That means starting your project now to get the process started and completed before the end of 2025.

Act now and get your solar project started in time before the rush of demand. Contact Green Ridge Solar to get on the install schedule and in line to lock in your solar tax credit before it expires.

Impacts on the Solar Industry and Market

Project Cancellations and Delays

Industry analysts expect thousands of residential and utility-scale projects to be delayed or cancelled due to the loss of credits. The uncertainty is likely to slow down investment, shrink installer backlogs, and erode market confidence.

Job Losses and Shrinking Growth

Energy Innovation Policy & Technology, a non-partisan energy and climate policy think tank, estimates that OBBBA could put up to 1.6 million clean energy jobs at risk by 2035, with ripple effects throughout the solar supply chain. Domestic manufacturing efforts may stall without consistent demand, undermining “Made in America” goals.

Commercial Market Gains Priority

With residential credits vanishing, many installers are expected to shift focus toward commercial and industrial solar installations, which still qualify for scaled-down credits through 2028. This could further reduce homeowner access to experienced installation teams as demand spikes.

Wall Street Response

Public solar companies like Sunrun, SolarEdge, and Enphase saw significant stock dips after the bill’s announcement, reflecting market concerns over the industry’s future under reduced federal support.

The Future of Solar in the U.S.

Slowing Momentum at a Critical Juncture

The U.S. had just begun to accelerate its transition to clean energy, with solar outpacing coal and gas in new energy installations. OBBBA threatens to reverse that momentum, delaying the country’s climate goals and increasing long-term energy costs.

Rising Dependence on Foreign Suppliers

Without robust federal incentives, U.S.-based solar manufacturers may struggle to compete with cheaper imports. This could increase reliance on China and other foreign producers, countering bipartisan efforts to localize clean energy production.

Other Sectors Stand to Gain

As solar loses federal support, fossil fuel, nuclear, and hydrogen sectors may see a shift in subsidies and policy focus. This could reshape the energy landscape for decades to come.

What Homeowners Should Do Now

Act Immediately

If you’re interested in solar, the timeline is no longer flexible. Permits, utility approvals, and scheduling can take several months. The safest path is to start the process now to ensure you qualify.

Act now and get your solar project started in time before the rush of demand. Contact Green Ridge Solar to get on the install schedule and in line to lock in your solar tax credit before it expires.

Consider Adding Battery Backup

Along with the expiration of the solar tax credit, battery backup/energy storage systems will also lose their tax credit eligibility after Dec. 31, 2025. Adding battery storage now can help you lock in additional tax benefits and prepare your home for outages and grid instability.

Don’t wait until the solar tax credit is expires. Get your solar and battery quote today to slash your energy bills and protect your home or business with battery backup.

Act Now to Qualify for Solar Tax Credit

The passage of the One Big Beautiful Bill (OBBBA) marks the beginning of the end for the federal solar tax credit as we know it. Homeowners and businesses have a limited window to take advantage of the solar tax credit. Homowners need to install solar and/or battery backup systems by Dec. 31, 2025, to take advantage of the solar tax credit.

Whether you’re interested in reducing your utility bills, increasing your home’s resilience, or cutting your carbon footprint, there has never been a more urgent time to go solar and install battery backup.

Contact Green Ridge Solar now to get the process started and secure your install timeline. Remember, solar and/or battery backup systems need to be installed and operational by Dec. 31, 2025, to qualify for the tax credit. Get your quote today to secure your installation times lot and to get everything complete before the solar tax credit expires.