One of the biggest shifts from the bill is the rollback of federal tax credits for wind and solar energy. Projects that begin construction within a year of the bill’s enactment still qualify, but anything beyond that loses access to long-standing incentives like the Investment Tax Credit (ITC) and Production Tax Credit (PTC).
New York has benefited heavily from these credits, especially through its Climate Leadership and Community Protection Act (CLCPA), which sets a goal of 70% renewable electricity by 2030. Developers may rethink or delay projects, which could affect energy targets and job growth statewide.
Reducing support for renewables may shift production back toward fossil fuels. Analysts suggest this could raise electricity costs in the coming decade — possibly by hundreds of dollars per household annually. In a state where local governments are already watching budgets carefully, rising energy prices could also impact schools, public buildings, and transit systems.
The bill makes it easier to approve new fossil fuel projects, including natural gas pipelines. For New York, that could mean revisiting long-contested proposals like the Constitution Pipeline. These developments may boost short-term supply but raise environmental and health concerns, especially in communities near infrastructure projects.
Since 2022, the Inflation Reduction Act (IRA) brought major funding to New York: over $2 billion in grants, hundreds of millions in household rebates, and direct payments for municipalities investing in clean energy. Heat pumps, solar panels, and efficiency upgrades became more affordable for thousands of residents.
With the OBBB now law, many of those incentives will phase out by 2027. Tax credits tied to energy efficiency and solar are being scaled back, and new restrictions on federal payments could make it harder for nonprofits and local governments to use them.
New York’s energy future remains ambitious, but the federal changes introduced by the OBBB create new challenges. For local leaders, understanding how these shifts intersect with state policies and community needs will be key over the next few years.
