WNY Wind and Solar Projects Hang in Balance as Feds Tighten Rules on Renewables

The sight of towering wind turbines and fields carpeted with solar panels is becoming increasingly common in rural areas of Western New York.

It’s all part of the state’s push to ramp up renewable energy to meet climate goals. But in July, the Trump administration passed measures to block wind and solar projects nationwide within the “One Big Beautiful Bill.”

It’s caused a race against time to start construction on wind and solar projects across the country. Only those that begin physical work by July 4, 2026, will be eligible for federal tax credits — credits that typically cover around a third of project costs.

“We oftentimes hear about the calm before the storm, we flipped that on its head, and we’re now experiencing the storm before the calm,” said Environmental Lawyer David Flynn, a partner at law firm Phillips Lytle. “Once the gate comes down and we’re past certain deadlines, a lot of these projects are really going to dry up,” he said.

Acting on an Executive Order signed by President Donald Trump in July, the IRS has also imposed stricter rules around the timeline and definition of the “beginning of construction” for wind and solar projects.

Under the previous rules, developers could qualify for federal tax credits by demonstrating the “beginning of construction” through either physical work – such a site clearing or foundation work – or by spending at least 5% of total projects costs. The new rules get rid of that 5% spend option, requiring developers to show substantial physical work on-site in order to qualify as having started construction before the deadline.

Once started, that physical work must be continuous, and the project must be operational within four years.

According to Flynn, there’s just not enough construction workers to keep up with the demands of that timeline.

“They’re being pulled to almost every state in the U.S. by developers all trying to do the same things, and that is, get their projects in under the wire,” he said.

The result? Flynn believes some developers will hold off until there’s a new administration, while others may ditch their plans altogether.

Impact on renewables WNY?
In Western New York, 10 wind and solar projects have permits but have not yet started construction according to the State Department of Public Service. One of them is Heritage Wind in Orleans County. The 126-megawatt project has been in the works for nearly a decade, and Brian O’Shea – who’s the director of public engagement for the project’s developer Apex Clean Energy – said the new deadline doesn’t change anything for the project timeline.

“We’re still planning construction early next year and being operational by the end of 2027,” O’Shea said.

If that works out, they will still qualify for the federal tax credits for this specific development, but O’Shea maintains those credits are not the main incentive propelling the Virginia-based company.

Instead, it’s meeting the demand for energy.

“From our standpoint, we’re not stopping work, you know, on projects across the country as a result of this bill. America needs more energy, and they’ll continue to be more energy projects,” he said.

But he added that for any energy project, incentives are often factored into power prices, so when that incentive is removed there’s usually a “corresponding increase” in the cost of power.

Governor Kathy Hochul lamented the new rules, saying said they will have “dire effects” on the state’s ability to head into a “clean energy future.”

“So I assembled my team immediately, and we are trying to do everything we can to expedite those that are already in the pipeline, to get those the approvals they need to move ahead,” Hochul said.

For lawyer Flynn, state incentives – generated from charges added to consumers’ utility bills – might be just enough to keep some wind and solar projects moving in Western New York.

“I think in New York the pipeline will shrink, and perhaps materially shrink, but I think there will continue to be opportunities and a market for some of these renewable energy projects.”

Story by Holly Kirkpatrick/New York Public News Network

Image by wirestock on Freepik