Trump promised to lower energy costs – his tax bill will raise them for people in red states the most

The Guardian

12 hours ago

The cost of electricity is poised to surge across the US in the wake of Republican legislation that takes an axe to cheap renewable energy, with people in states who voted for Donald Trump last year to be hardest hit by the increase in bills.
As air conditioners crank up across the US during another sweltering summer amid an unfolding climate crisis, rising energy costs will become even more severe for households due to the reconciliation spending bill passed by Republicans in Congress and signed by Trump, who called it the 'big, beautiful bill', on 4 July.
By stripping away support for cheap solar and wind energy production, the legislation is set to cause electricity rates paid by families and businesses, many already struggling to pay their bills, to rise by much as 18% by 2035, according to an analysis by Energy Innovation, an energy and climate policy thinktank.
Household energy costs, which span electricity and gas use, will rise by $170 on average every year by 2035, the report finds, with Republican-leaning states bearing the brunt of the increases. Bills in Missouri will spike the most, by $640 a year, with the next largest increases – in Kentucky, South Carolina, Oklahoma, North Carolina and Texas – all also hitting states that voted for Trump in last year's presidential election.
Trump won the election, in part, by promising to lower inflation and cut US energy costs in half within a year. In office, he has sought to boost fossil fuel consumption while slashing incentives for clean energy projects and barring them from federal lands.
'I don't want windmills destroying our place,' the president said last month. 'I don't want these solar things where they go for miles and they cover up a half a mountain that are ugly as hell.'
But the Republican bill's wiping out of tax credits for renewables will stymie wind and solar projects that are typically now cheaper than gas or coal, forcing utilities to rely more heavily on existing, inefficient gas generators, Energy Innovation said. This will push up energy costs across the US, particularly in states that have not enacted their own policies to boost renewables.
'Demand for electricity is increasing and without renewables we aren't able to meet that new demand,' said Dan O'Brien, senior analyst at Energy Innovation and author of the new study.
'We've seen US power prices generally fall over the past 75 years, but with this bill for the first time we will see sustained increases in power costs. Lower-income folks in rural areas in red states will have compounding impacts from this bill – their states voted to pass this but it will really harm them in the long term.'
Environmental groups were scathing of the Republicans who voted for the reconciliation bill. 'After an election where cost-of-living was the driving issue that pushed millions of working-class Americans to check the box for Donald Trump, it's mind-boggling that Republicans just passed a bill that will raise costs across the board,' said Lena Moffitt, executive director of Evergreen Action, a climate change advocacy organization, who called the legislation 'one of the most catastrophic bills in a generation'.
Electricity prices for American households have already increased above the rate of inflation since 2022, with a slew of new data centers for artificial intelligence helping push up overall demand for power. This trend has placed further strain upon 'energy insecure' people who struggle to meet the cost of heating, cooling and lighting their homes. Around 34m households, more than a quarter of all dwellings in the US, reported difficulties in paying energy bills in 2020.
'A lot of people are struggling and it's a hardship that's often not highlighted,' said Michelle Graff, an energy policy expert at the Georgia Institute of Technology. Lower-income people, as well as those who are Black, Hispanic, elderly, have young children or live in poorly constructed and badly insulated homes, are most at risk of this sort of energy insecurity.
'For a lot of these folks, even $10 extra on their bill each month will result in difficult trade-offs, such as forgoing medicines or food for their families,' Graff said. 'Increasing those bills month after month will have a big impact upon households on the margins.'
Electricity price rises are regulated by the states and some jurisdictions offer help to residents struggling to pay their bills, as Maryland did last month.
But such assistance is now being stripped away at the federal level, with the Trump administration seeking to eliminate the Low Income Home Energy Assistance Program (or Liheap), which aids around 6m US households with their bills. The reconciliation bill also deletes subsidies for the construction of energy-efficient homes and upgrades to home cooling, heating and insulation systems.
'That is a lifeline for many, many Americans,' Graff said of the Liheap program. 'There is this mismatch where the hardships are getting worse while we are cutting assistance for people to address that hardship.'
Across the US, utilities have pushed for $29bn in higher rates so far this year, which is 142% more than the same period in 2024, a recent report found. At least 16 states, meanwhile, allow utilities to cut off power to people during extreme heatwaves if they have not paid their bills. Such cutoffs can prove deadly – last month, Shauna Thomas, a 55-year-old woman, was found dead in her stiflingly hot St Louis, Missouri, apartment after her electricity was halted for non-payment.
'Air conditioning and access to electricity is life-saving, but in most states there are very limited protections for these shut-offs,' said Diana Hernandez, a researcher of energy and health inequities at Columbia University. 'People are reluctant to put on their AC because of the fear of a high bill. It's easy for them to get into a debt spiral and hard for them to get out of it. This can end up as a life-or-death matter.'
Extreme heat is the leading weather-related cause of deaths in the US, with advancing global temperatures due to the burning of fossil fuels causing longer and fiercer heatwaves. This summer in the US is expected to be hotter than the long-term norm for the season, with explosive demand for cooling causing a strain upon the grid in some places – in June, 110,000 people in New York City lost power due to a surge of electricity use during a hot spell.
In the hottest parts of the US, lengthy power blackouts could prove catastrophic. If a prolonged heatwave and a blackout hit Phoenix, Arizona, at the same time, half of the city's 1.6 million residents would require urgent medical help and 1% of the population would die, a 2023 study warned.
'Climate change is upon us and as it gets hotter and hotter, there will be more hardship that people face in trying to keep themselves cool,' said Hernandez.
'It used to be that people thought about energy access in the winter months, to help keep them warm, but that has changed now. As we keep getting hotter years, this problem isn't going away.'
The White House was contacted for comment.