Finding
The manufacturing credit survived OBBBA intact for batteries and solar, but now excludes Chinese-linked suppliers
Section 45X pays a fixed amount for each qualifying component made in the US and sold: $35 per kWh for battery cells, $10 per kWh for modules, 10% of cost for electrode active materials and critical minerals, and per-watt or per-kilogram amounts for solar parts and inverters. A factory shipping 10 GWh of cells earns up to $350 million a year. OBBBA kept the original schedule for batteries, solar and inverters - full value through 2029, zero after 2032 - and ended the credit for wind components after 2027.
The catch is the foreign-entity rules. For tax years beginning after July 4, 2025, a manufacturer cannot claim 45X if it is a "prohibited foreign entity" - owned, controlled or influenced by China, Russia, Iran or North Korea - or receives "material assistance" from one above set thresholds. That pushes US battery and solar plants to source cathode, anode, wafers and equipment away from Chinese suppliers, which is where the supply-chain pages on this site show the real bottlenecks. OBBBA also added metallurgical coal as a qualifying mineral through 2029 and scheduled critical minerals to phase out from 2031.
Two investment credits sit alongside 45X: the advanced energy project credit (48C), awarded competitively for building or re-equipping clean energy factories, and the semiconductor investment credit (48D), which OBBBA raised from 25% to 35% for fabs that start construction by the end of 2026. In Texas, 45X underpins T1 Energy's solar cell factory in Austin; see T1 Energy G2 Austin on AustinIO.
Rates
45X credit amounts and phase-out
| Component | Credit | Phase-out |
|---|---|---|
| Battery cells | $35 per kWh | Full to 2029; zero after 2032 |
| Battery modules | $10 per kWh ($45 if no cells used) | Full to 2029; zero after 2032 |
| Electrode active materials | 10% of production cost | Full to 2029; zero after 2032 |
| Critical minerals | 10% of production cost | Phase-out 2031-2033 |
| Polysilicon | $3 per kg | Full to 2029; zero after 2032 |
| Wafers | $12 per m2 | Full to 2029; zero after 2032 |
| Solar cells | $0.04 per W | Full to 2029; zero after 2032 |
| Solar modules | $0.07 per W | Full to 2029; zero after 2032 |
| Inverters | $0.0025-0.11 per W by type | Full to 2029; zero after 2032 |
| Torque tubes, fasteners | $0.87 and $2.28 per kg | Full to 2029; zero after 2032 |
| Wind components | Varies by part | Ends after 2027 |
| Metallurgical coal | 2.5% of cost | Ends after 2029 |
Other programs
Other manufacturing incentives
| Program | What it does | Status | Note |
|---|---|---|---|
| 48C advanced energy project credit | Up to 30% of factory investment, allocated by DOE and Treasury | Kept | No new allocation rounds announced |
| 48D semiconductor investment credit | 35% for fabs and equipment (was 25%) | Kept, increased | Construction must begin by end of 2026 |
| FEOC / prohibited foreign entity rules | Bars 45X for entities owned or assisted by China, Russia, Iran, North Korea | New | Tax years after Jul 4, 2025 |
| DOE loans (ATVM, Title 17) | Now Office of Energy Dominance Financing | Replaced | Priorities: nuclear, fossil, minerals, grid, manufacturing |
Sources
Sources and scope
- Scope
- Federal manufacturing credits for clean energy and EV components (merges the former manufacturing incentive pages)
- Sources
- One Big Beautiful Bill Act (Public Law 119-21, July 4, 2025); Kirkland, Troutman, PwC and Hogan Lovells analyses (2025); CRS on 45X (2026)
- Updated
- October 2026