Tesla Pleads for Senate to Preserve Energy Tax Credits

Tesla, the electric vehicle and clean energy company, is urging the U.S. Senate to maintain key tax credits that support its booming energy business. This comes as House Republicans have passed a bill that would undo much of the Inflation Reduction Act, including the residential solar and clean energy tax credits.

Tesla's energy division has become a rare bright spot for the company, bringing in $2.7 billion in revenue in the first quarter of 2025 - a 67% increase year-over-year. This division relies heavily on government incentives and regulations, from the Department of Energy loan guarantee in 2009 to the regulatory credits it sells to other automakers.

Now, with the potential repeal of the Inflation Reduction Act's tax credits, Tesla is warning that this could have a "devastating impact" on its energy business. The company says that abruptly ending these credits would "threaten America's energy independence and the reliability of our grid."

Tesla is lobbying Senate Republicans directly on the social media platform X, urging them to enact legislation with a "sensible wind down" of the tax credits. The company argues that this will ensure the continued rapid deployment of over 60 GW of new clean energy capacity per year, which is crucial to support AI and domestic manufacturing growth.

The stakes are high, as the Trump administration's focus on "energy dominance" is already at risk. Last year, 93% of all new electricity generation capacity in the U.S. was from clean energy sources, mostly solar and grid-scale storage. Cutting these tax credits could slow this progress significantly.

For Tesla, its energy division has become a key driver of its overall business. With the company's EV sales facing faltering demand, preserving this revenue stream is critical. The battle over the Inflation Reduction Act in the Senate will be one to watch closely for the future of Tesla's clean energy ambitions.