The “One Big Beautiful Bill (or OBBB) is a budget package that could reshape the solar industry, unfortunately, not for the better. It passed the House on May 22, and if approved in the Senate, it could sunset the Residential ITC, restrict commercial credits, and shrink key incentive timelines. While not yet a law, momentum is building. Senate review is expected in June, with a final vote likely before July 4.
Here are the facts: we’ve outlined what’s included in the OBBB, what it means for solar teams, and what might come next.
Key Solar Incentive Changes in the OBBB Bill
- Residential ITC (25D):
- The 30% tax credit for homeowners would end on December 31, 2025, with no phase-down period or extension included—just a hard stop.
- Commercial Credits (48E & 45Y):
- TPO (third-party ownership) companies would no longer qualify as soon as the bill is signed into law.
- Projects must start construction within 60 days of enactment and finish by the end of 2028 to stay eligible.
- “Start of construction” means either breaking ground or spending at least 5% of total costs.
- Foreign Entity of Concern (FEOC) Rule:
- Any projects beginning after the end of 2025 must comply with FEOC guidelines.
- This could effectively disqualify many residential projects from incentives sooner than expected.
- Manufacturing Credit (48X):
- This stays unchanged and available through 2029, then gradually phases out by 2031.
- Transferability:
- Still technically allowed, but new restrictions make it difficult or impractical for 48E projects to proceed.
What This Means for Solar Sales Teams and Operations
The BBB hasn’t passed the Senate yet, but the direction is clear: the era of generous, open-ended incentives is ending. For residential solar teams, the most immediate concern is the retroactive disqualification of leased systems. Any sales made after January 1 under a lease structure may now be ineligible for tax benefits—a potential nightmare for reps, ops teams, and customers alike.
The sunset of the Residential ITC at the end of 2025 is also likely to trigger confusion and urgency in homeowner conversations. If that timeline holds, Q3 and Q4 will become a crunch point for teams racing to close and install projects. That kind of pressure demands speed, clarity, and airtight proposals. There’s less room than ever for vague financing claims or soft estimates.
This moment will also deepen the divide between teams that are structured to move quickly with precision and those still relying on patchwork workflows. If you’re quoting incentives manually, relying on PDFs, or sending out proposals without verified design data, you’re at a disadvantage. Policy-aware platforms with built-in compliance logic will define who wins this cycle.
What’s Next: The Timeline
As of now, the OBBB is being reviewed by the Senate Financing Committee, and they’re aiming to finalize it before July 4, 2025. Since it’s moving through budget reconciliation, it only needs a simple majority to pass—and Republicans are in charge of making any changes. That said, a few key moderate Senators are trying to protect certain clean energy credits, especially around transferability and softening the rollback on commercial incentives.
If the Senate makes changes, the bill will be sent back to the House for another vote. Either way, the timeline is tight. Congress is attempting to finalize the budget before the next fiscal year begins on October 1. If they don’t, we could be looking at a temporary funding bill or even a shutdown.
Even before anything passes, the market will react. Homeowners will have questions; Competitors might change their close dates. The teams that understand what’s going on and have tools to keep up with policy shifts will be the ones leading the conversation.
Preparing for Solar Incentive Changes
This isn’t just about federal credits—it’s about staying ahead of industry change. Whether or not the OBBB passes as written, the conversation around solar incentives is evolving. Teams that build with speed, accuracy, and transparency won’t just survive the shift—they’ll lead through it.
Solo proposals are built for moments like this: fast, verified, and backed by policy-aligned logic.
[See how we help solar teams adapt →]