Big Beautiful Bill: Tax, subsidy cut on clean energy trigger outrage

Washington: The US Senate's proposed cuts to clean energy subsidies and the introduction of a new tax on wind and solar energy in its version of President Donald Trump's tax and spending bill have drawn searing criticism from business and labour groups since they were unveiled over the weekend, with some arguing the moves could lead to power shortages, raise power prices and kill jobs.

The pushback, which includes a swipe from Trump ally and Tesla CEO Elon Musk, comes as senators started voting on a potentially long list of amendments to the bill on Monday, giving renewable energy advocates on both sides of the political spectrum a last window to push for changes.

"Taxing energy production is never good policy, whether oil & gas or, in this case, renewables," said Neil Bradley, policy director of the US Chamber of Commerce, in a post on X over the weekend. "Electricity demand is set to see enormous growth & this tax will increase prices. It should be removed."

"This would be incredibly destructive to America!" Musk posted on X, saying the cuts could endanger the development of energy-hungry artificial intelligence technology, among other things.

Trump has said he intends to maximise US energy production, with a focus on fossil fuels, in part to ensure the power industry can supply the AI industry's growth. But he has also promised to wipe out subsidies for renewables. The Senate bill would roll back incentives for wind, solar, batteries and other clean energy technologies created by President Joe Biden's 2022 Inflation Reduction Act, and add a new tax on these projects if they cannot prove their products are made without Chinese parts.

Energy secretary Chris Wright on Monday seemed to brush off warnings about the loss of generation capacity amid soaring demand. "The more we load our grid with intermittent generation, the worse the grid performs during times of maximum demand," he posted on the social media platform.

Sean McGarvey, president of the North America's Building Trades Unions, which represents over 3 million construction workers, blasted the bill's impact on jobs. "If enacted, this stands to be the biggest job-killing bill in the history of this country. Simply put, it is the equivalent of terminating more than 1,000 Keystone XL pipeline projects," he said in a statement, referring to an oil pipeline project blocked by Biden's administration.

Republican leaders are rushing to overcome internal fights over the massive tax and spending package. Senate Republicans were still at odds Monday over how much to cut from Medicaid and other social safety-net programmes. Trump remained in contact with lawmakers Monday, as he was over the weekend, said an official who added the White House is optimistic the president would get the legislation to sign by Friday.