The Big Beautiful Bill: What It Means for Commercial Solar

The recently enacted “One Big Beautiful Bill Act” (H.R. 1) dramatically accelerates the wind-down of solar incentives established under the Inflation Reduction Act (IRA). While it creates new opportunities for domestic manufacturing, it also compresses timelines for developers and shifts supply chain dynamics directly impacting manufacturers supplying solar modules, racking, and balance-of-system components.

Accelerated Phase-Out of Tax Credits

• Commercial ITC/PTC: The 30% federal Investment Tax Credit and Production Tax Credit for commercial and utility-scale solar will now end for projects placed in service after 2027. To qualify, projects must start construction by July 2026 and finish within four years.

• Residential ITC: The 30% credit for homeowners expires after 2025 installations.

• Safe Harbor: Manufacturers serving EPCs and developers should expect a surge in demand through 2026 as projects move to lock in credits before phase-out.

Domestic Content & FEOC Restrictions

• New supply chain rules require that 40% of project value come from non-foreign entity of concern (FEOC) sources beginning in 2026, increasing to 60% by 2030.

• This shift incentivizes domestic production and allied sourcing, opening market share for U.S.-based manufacturers and partners outside China, Russia, and other restricted countries.

Utility Rate Pressures & Demand Drivers

• Florida and other Sun Belt states face historic utility rate hikes — Florida Power & Light has proposed nearly $9 billion in increases, raising rates 22% by 2027.

• Commercial rates in Florida have already risen ~10% year-over-year to 11.88¢/kWh. These escalating costs accelerate payback timelines for solar, driving adoption even as credits phase down.

AI Data Centers Fuel Growth

• Florida is rapidly becoming an AI data center hub, with projects like Iron Mountain MIA-1 (16 MW) and Project Apollo ($150M, 15 MW) in Miami-Dade.

• These facilities require massive, reliable clean power, creating opportunities for co-located solar and storage projects and greater grid resilience needs.

Implications for Manufacturers

• Demand Spike Through 2026: Expect accelerated procurement cycles as developers race to safe-harbor equipment.

• Shift Toward Domestic Content: FEOC restrictions will reward U.S.-based and allied suppliers, favoring those able to certify compliant sourcing.

• Potential Volatility After 2027: As credits end, market volumes may dip; diversification into storage, microgrids, or export markets could smooth transitions.

• Strategic Partnerships: Collaboration with EPCs like Advanced Green Technologies, which specialize in safe-harbor structuring, can help align manufacturing capacity with compressed timelines.

Article was co-authored: Clint Stockman and Eric Woods

Advanced Green Technologies is Florida’s market leader in commercial solar design and construction, offering a comprehensive range of clean energy solutions, including:

• Solar Carports

• Rooftop Solar

• Ground-Mounted Systems

• Floating Solar

• Battery Energy Storage Systems (BESS)