US judge overturns Trump's policy on wind and solar tax breaks

According to court documents, a U.S. Judge vacated the Trump Administration policy that was implemented last year and made it more difficult for wind and solar energy projects to receive federal tax subsidies.

The ruling is the latest legal blow for U.S. President Donald Trump's efforts to slow down development of clean energy technology, which he claims are unreliable.

Judge Colleen Kollar-Kotelly of the U.S. District Court for the District of Columbia ruled on Saturday that the Treasury Department’s Internal Revenue Service failed to?give an adequate reason for removing a long-standing definition of what it meant for a project to be deemed under construction.

Clean energy projects that begin construction or enter service before the end of the year 2027 are eligible for a 30% credit on their tax bill and bonuses.

During the past decade, project developers were able to "safe harbor" projects for a period of four years by demonstrating substantial and continuous work or incurring 5% before an expiration date.

IRS rules announced in August last year eliminated the 5% provision, except for small projects. The IRS rules notice was sent back to the IRS by Judge Kollar Kotelly "for further review."

Last year, plaintiffs including the environmental groups Oregon Environmental Council, Natural Resources Defense Council, consumer advocate organization?Public Citizen and clean energy consultancy?firm Woven Energie filed a lawsuit challenging the IRS rules.

The?suit claimed that the rule changes would increase electricity prices and prevent clean energy projects being built.

San Francisco City Attorney David Chiu stated in a statement that "this?decision places an important check on administration's actions which are driving up energy costs for everyday Americans across the country." "We will fight to ensure that the market is fair and predictable, allowing clean energy providers to develop projects that are beneficial to us all."

A spokesperson for the IRS said that they would not comment on any pending litigation. (Reporting and editing by Nichola groom)

(source: Reuters)