At the Iowa State Fair Friday, Republican U.S. Sen. Chuck Grassley posed for photos at the Power Up Iowa exhibit with renewable energy developers, technicians and advocates.
Grassley is often called the “father of wind energy” for introducing the first federal wind energy production tax credit, which took effect in 1993.
“I'm really pleased with the way things have worked out,” Grassley said.
Today, around 60% of Iowa’s net generation of electricity comes from wind energy. It’s the highest share of any state. While solar represents a much smaller percentage, the sector has rapidly grown in recent years with the help of tax credits — mostly notably from the Inflation Reduction Act (IRA) of 2022.
The IRA expanded tax credits for renewable energy projects and extended many of the credits for a decade or more.
The version of the One Big Beautiful Bill Act that first passed in the U.S. House of Representatives would have ended some credits for wind and solar projects that started construction more than 60 days after the legislation was signed. The U.S. Senate’s version was less severe. For example, utilities that begin construction on a wind or solar project by July 4, 2026 will still qualify for a production tax credit.
“I think that might not be as good as what wind power people wanted, but it's sure a heck of a lot better than what the House of Representatives did. So, we're going to have to fight to make sure that this is carried out the way the Senate [intended],” Grassley said.
The House approved the Senate’s bill, and Trump signed the "Big Beautiful Bill" into law July 4. But three days later, Trump issued an executive order directing the Secretary of the Treasury to end tax credits for wind and solar.
Grassley said the main concern is that the Treasury may issue new criteria for “beginning of construction.” This could make it harder for wind and solar projects to qualify for the tax credits even before they expire next July.
“We made very clear in the legislation that the practice of the last 10 years, both from the standpoint of the regulation, as well as the guidelines, was what should be followed as a result of the compromise that we made in the United States Senate,” Grassley said.
He said the renewable energy statutes in the Senate version of the bill were “the difference between getting the votes” to pass the One Big Beautiful Bill Act.
Grassley announced Aug. 1 that he will delay three of Trump’s nominees to the treasury until the agency’s rules “adhere to the law and congressional intent.” He’s joined by Republican Sen. John Curtis of Utah.
The treasury is expected to issue its regulations by Aug. 18.
Jason Grumet, the CEO for the American Clean Power Association, said many of the tax credits for renewable energy have been around for decades.
“The problem was they'd be for two years, and they'd expire, and then companies wouldn't know what to do, and it was hard to make investments,” Grumet said.
The IRA created stability for the sector, but it also politicized renewable energy, he added.
Beyond tax credits
Grumet emphasized the wind industry can handle the phase out of tax credits, even though it’s expected to increase prices and uncertainty.
“It’s the additional restrictions that are being put forward that no one anticipated that will literally stop Iowa companies from building any more wind power,” Grumet said.
Trump’s executive order also "directs the secretary of the interior to revise regulations and policies to eliminate preferential treatment for wind and solar facilities compared to reliable, dispatchable energy sources.”
This includes an “elevated review” for leases, construction plans and grants for wind and solar projects on federal land. Additionally, the Department of the Interior is investigating how wind turbines may impact migratory bird populations, which could impact projects on private land; they still need to comply with federal wildlife protections.
According to the Audubon Society, climate change poses the greatest threat to birds and responsibly-sited wind and solar energy “is essential for bird conservation.”
The U.S. Department of Transportation is also recommending a minimum 1.2-mile setback for wind turbines built near highways and railroads.
Mak Heddens, the senior advisor of Power Up Iowa, a statewide coalition of renewable energy supporters, said the industry is navigating a slew of challenges with recent policy changes.
“Clean energy is in our backyards,” Heddens said. “It's a huge benefit to Iowans with tax revenue for communities that helps supplement schools and infrastructure, provides payments to farmers — and given current market conditions, that's critical right now. So, we're proud to be a part of a very important industry in Iowa.”
