Inside Washington: August 2025 Updates

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Updated Guidance on Wind & Solar Tax Credits

Accelerating Federal Permitting of Data Centers

Don’t Miss the GA Team at the 2025 NECA Convention

NECAPAC Update

Updated Guidance on Wind & Solar Tax Credits

Under the One Big Beautiful Bill Act (OBBBA), the Clean Electricity Production Tax Credit (PTC) (section 45Y) and Clean Electricity Investment Tax Credit (ITC) (section 48E) enacted through the Inflation Reduction Act are phased out. However, there is a “Safe Harbor” period whereby projects can still qualify if they (1) begin construction before July 5, 2026, or (2) are placed in service no later than December 31, 2027.

Historically, a project has “begun construction” if at least 5% of upfront costs have already been spent or if measurable physical work has been done on the project, also known as the Physical Work Test. The Department of Treasury, under the direction of President Trump, has issued updated guidance stating that a project has begun construction for purposes of qualifying for 45Y or 48E credits only if it passes the Physical Work Test, eliminating the 5% upfront cost qualifier. This means that credit recipients must demonstrate that significant physical work, either on-site or off-site, has been done in order to qualify.

Physical work of a significant nature does not include work (performed either by the taxpayer or by another person) to produce property that is either in existing inventory or is normally held in inventory. Off-site work of a significant nature may include the manufacture of components such as wind turbines and tower units, transformers, other power conditioning equipment, mounting equipment, support structures such as racks and rails for solar panels, and inverters.

On-site work of a significant nature for a solar facility may include the installation of racks or other structures to affix photovoltaic (PV) panels, collectors, or solar cells to a site. On- site work of a significant nature begins for a wind facility with the beginning of the excavation for the foundation, the setting of anchor bolts into the ground, or the pouring of the concrete pads of the foundation.

Republican Senators and Representatives from heavy wind and solar states have called out the Administration for going against Congressional intent in the implementation of OBBBA, stating that they meant for the 5% Safe Harbor to remain in place. There is also likely to be significant legal action against the guidance.

Accelerating Federal Permitting of Data Centers

President Trump issued an Executive Order that directs federal agencies to streamline permitting reviews, provide financial support, and utilize federal land for the expeditious development of data centers. The action focuses on high-capacity projects for AI and national security.

The EO, entitled Accelerating Federal Permitting of Data Center Infrastructure, and a related report, Winning the Race, America's AI Action Plan (the "AI Action Plan"), support the rapid and efficient buildout of digital infrastructure. The AI Action Plan states that "America's environmental permitting system and other regulations make it almost impossible to build [digital] infrastructure in the United States with the speed that is required."

The EO facilitates expedited permitting for data centers and related infrastructure, energy, and manufacturing projects in numerous ways, including under the Clean Water Act ("CWA"), the Clean Air Act ("CAA"), the National Environmental Policy Act ("NEPA"), and Fixing America's Surface Transportation Act ("FAST-41").

Specifically, the Executive Order establishes a whole-of-government approach to cutting all possible red-tape related to data center projects allowable under current law. This includes agency legal reviews, analysis of existing data center permitting applications, and increased inter-agency coordination.

The President’s action comes at the same time as wholesale, bipartisan permitting reform appears to be taking shape in Congress. The Government Affairs team will continue to engage with our partners in Congress, the Administration, and industry to ensure any final permitting reform package reflects the needs of NECA contractors.

Don’t Miss the GA Team at the 2025 NECA Convention

Join us bright and early on Saturday, September 13, 2025, from 8:00 AM to 9:50 AM in MPW W179 for a must-see session: Navigating a New Washington. This timely discussion, featuring Marco Giamberardino, James Payne, Ryan McGuire, and Seth Guidry will offer expert insights into our evolving political landscape and what it means for electrical contractors in the age of Trump 2.0.

Additionally, Timothy D’Arduini, and Natalia Gouz of Klasko Immigration Law Partners, LLP will share the latest on what’s happening across the country as it relates to immigration policy and what you can do to protect your business. This session is eligible for 1 Continuing Education Credit.

Why you should be there:

• Explore the latest shifts in federal policy and how they’re shaping the electrical construction industry.
• Gain clarity on workforce and immigration policy changes, and what they mean for your business and the industry’s future.
• Learn directly from industry and government affairs leaders offering strategies to adapt and succeed.

Be part of this essential conversation—set your alarm, mark your calendar, and make the most of your NECA Convention experience!

Can’t make it to the session? No problem! You can find members of the GA team throughout Convention at the Trade Show in the Emerging Innovation Hub (Booth 1438).

NECAPAC Update

NECAPAC Funds Raised: $535,537
Operational Funds Raised: $498,166

We’d like to extend a very special Thank You to our PLC members for renewing their 2025 contributions:

Congratulations to the following Chapters for reaching their 2025 PLC Chapter Goals:

2025 Capitol Competition Update