As the policy landscape evolves, it’s crucial we keep a close eye on developments that could shape the future of clean energy in the U.S. The past couple weeks brought significant updates to the Inflation Reduction Act (IRA) framework—updates that, while not without concern, are more measured than anticipated. While any reduction to current incentives is a step back, this proposal provides clarity and, importantly, a long runway for adaptation and advocacy.
Here’s what we're seeing in the first draft of the legislation—and what it means for solar, wind, and battery storage:
Gradual Sunset of Main Tax Credits
The foundational tax credits for clean energy—48E Investment Tax Credits (ITCs) and 48Y Production Tax Credits (PTCs)—are set to begin sunsetting in 2029. The phaseout will follow a 4-year slope: 80% in 2029, then 60%, 40%, and ultimately 0%. While not ideal, this provides long-term visibility and a path for potential renewal, as we've seen in past cycles.
Transferability Limits, But with a Practical Buffer
Transferability will be phased out for projects that begin construction two years after the bill's enactment. In effect, any project safe-harbored before mid-to-late 2027 will still qualify. This gives the market time to adapt, and there's every possibility this could shift again with future administrations or legislative amendments.
Direct Pay and Adders Remain Intact—For Now
The structure around direct pay and tax credit adders (e.g., domestic content, energy communities) remains untouched—welcome news for C&I developers. However, certain other credits, including Section 25D for residential solar and 30C for EV charging, are slated for sunset beginning December 31, 2025. Notably, the expiration of 25D may open the door to increased adoption of third-party ownership models in residential solar.
New Restrictions for Foreign Ownership
A new recapture provision has been introduced targeting ownership and influence by “Prohibited Foreign Entities,” also known as Foreign Entities of Concern. This could have implications for financing and partnerships, particularly for projects with complex international structures or components.
At Solar One, we’re tracking these developments closely. This is just the starting point in what will be a longer process. We’re engaging with industry peers, partners, and policymakers to ensure that commercial and industrial solar continues to be supported through sound, forward-thinking policy.
We’ll keep you informed as this legislation moves through Congress—and continue advocating for a clean energy future that remains accessible, resilient, and scalable.
MILPITAS, Calif.--(BUSINESS WIRE)--SolarEdge Technologies, Inc. (Nasdaq: SEDG) a global leader in smart energy technology, today announced that its comprehensive U.S.-manufactured solar inverter portfolio has achieved Build America, Buy America (BABA) Act compliance, notably including its planned Commercial & Industrial (C&I) 480V product line. This milestone will enable participation in federal infrastructure projects, including federally funded grants and projects, while supporting domestic manufacturing and job creation across its facilities in Florida and Texas.
The BABA-compliant portfolio includes the 480V and 208V Three Phase Inverters and Three Phase Inverters with Synergy Technology with C651U and C652U Power Optimizers, as well as the Single Phase SolarEdge Home Hub inverters and U650 Power Optimizers.
By achieving compliance with BABA for its planned DC-optimized inverter solutions, SolarEdge will support developers and EPCs in meeting federal infrastructure requirements, while maintaining maximum system performance, safety, and reliability.
"At Solar One, we recognize SolarEdge's commitment to delivering cutting-edge inverter solutions,” said Aaron Wilson, CEO of Solar One. "Their upcoming BABA-compliant 480V DC optimized inverter solutions for C&I applications will be immensely valuable to our end customers and the long-term viability of their investments. SolarEdge’s focus on safety, power optimization, and their advanced monitoring capabilities makes them the clear choice for Commercial and Industrial projects.”
“SolarEdge's BABA-compliant inverter portfolio, especially their 480V commercial solutions, will enable us to confidently pursue federally funded projects with technology that maximizes system performance and design flexibility," said Craig Collins, Senior Associate at PAE Engineers. “This compliance helps us deliver optimal solutions for communities seeking to lower their energy costs while supporting domestic manufacturing.”
John Carroll, Vice President, C&I North America at SolarEdge Technologies, said: "By manufacturing these advanced systems domestically and achieving BABA compliance, our C&I inverter solution in particular will be able to promote the deployment of premium U.S. solar technology across federal infrastructure projects, supporting American jobs and innovation."
About SolarEdge
SolarEdge is a global leader in smart energy technology. By leveraging world-class engineering capabilities and with a relentless focus on innovation, SolarEdge creates smart energy solutions that power our lives and drive future progress. SolarEdge developed an intelligent inverter solution that changed the way power is harvested and managed in photovoltaic (PV) systems. The SolarEdge DC optimized inverter seeks to maximize power generation while lowering the cost of energy produced by the PV system. Continuing to advance smart energy, SolarEdge addresses a broad range of energy market segments through its PV, storage, EV charging, batteries and grid services solutions. Visit us at: solaredge.com
Aaron Wilson
Chief Executive Officer