What the Senate’s Elimination of 25C Means for Energy Efficiency

This afternoon, the U.S. Senate passed the “One Big Beautiful Bill Act” (OBBBA) by a 51-50 vote. The bill eliminates the Energy Efficient Home Improvement Tax Credit (25C) at the end of this year—a deeply disappointing outcome for our industry. It also ends the 45L New Energy Efficient Home credit after June 2026 and rescinds unspent funds for state energy efficiency contractor training grants (TREC), among other provisions. 

For those of us who’ve worked to build a stronger workforce and reduce energy bills, this is a significant setback. But our work continues. 

For contractors and industry professionals, 25C has been a key driver of business—boosting demand for energy-efficient products and services and supporting local clean energy jobs while reducing upfront costs for consumers and cutting home energy bills. The credit’s sudden elimination creates real uncertainty for contractors and homeowners alike and underscores the need for consistent, long-term support for energy efficiency.

While today’s outcome is a step backwards, we are grateful for the efforts made to preserve 25C, and for the thousands of members, allies, and partners across all 50 states who raised their voices in support of keeping this critical incentive in place.

The Senate-passed version of OBBBA will now return to the House for consideration starting tomorrow. As Americans experience rising energy costs and our grid faces increased demand, we need 25C now more than ever. We hope you will stay connected with us as we continue our advocacy to advance energy efficiency, support contractors, grow our workforce, and improve energy affordability.

Sincerely,

Steve Skodak
CEO, Building Performance Association