A federal judge recently ruled the Trump administration cannot restrict tax credits for wind and solar energy, The Hill reported Monday.

The ruling comes one month before the credits are phased out entirely as part of the One Big Beautiful Bill Act passed last year.

Projects can only get tax credits for solar and wind energy if they began before July 5, 2026, or are placed in service before 2028, according to The Hill.

The Trump administration said projects could only get the tax credits if a project physically began work, throwing out an IRS provision that also classified incurring costs of 5% or more of a project's total cost as beginning work.

But Judge Colleen Kollar-Kotelly wrote in her ruling that excluding the 5% provision was "arbitrary and capricious."

"The Notice's elimination of the Five Percent Safe Harbor is a significant change in the IRS's position on what it means to 'begin construction' for purposes of clean energy tax credits," Kollar-Kotelly wrote.

"Because neither the Notice nor the administrative record provides an explanation from which 'the agency's path may reasonably be discerned' in light of all the facts and circumstances, the Notice is arbitrary and capricious," she added.

Jana Gastellum, executive director of the Oregon Environmental Council, one of the plaintiffs in the lawsuit celebrated the ruling in a statement to The Hill.

"This is a huge win for clean energy development and for everyone already feeling the impacts of rising electricity costs," Gastellum said.

"The IRS guidance that hindered these technologies was just another example of the federal administration causing energy market chaos. Saturday's decision removes that barrier," Gastellum added.