Thanks to the GOP Megabill, You'll Pay Higher Utility Bills

Yahoo

20 hours ago

This article is part of TPM Cafe, TPM's home for opinion and news analysis.
Natural gas price spikes, grid transmission bottlenecks, and a data center construction boom are already straining America's power grid. The Republican Party just passed a budget bill that might break it.
Donald Trump and the GOP's irrational energy agenda deliberately sidelines wind and solar energy — the lowest cost, fastest-to-deploy sources of energy generation available — to prop up a dying fossil fuel industry that won't be able to meet rising demand.
The consequences will be severe: hundreds of billions in clean energy investment will evaporate, hundreds of gigawatts of power won't get built, and hundreds of millions of metric tons of greenhouse gas emissions will be produced. By 2035, according to Princeton's ZERO Lab for energy research, the U.S. will have added 45% less clean electricity to the grid than it would have if Trump had not been reelected.
All of this comes as America's electricity demand is accelerating for the first time in decades. A report last year from the Clean Grid Initiative projected up to a five-fold increase in demand on the grid. Meanwhile, the U.S. added 64 TWh of solar generation to the grid in 2024 — enough to meet fully half of the record-breaking growth in electricity demand last year, according to independent energy think tank Ember Energy.
The only way America can meet rising energy demand and keep costs down is by building more wind and solar. Clean energy means lower utility bills, more good jobs, and cleaner air.
The Republicans don't care. It's a tale as old as the party. The GOP campaigns on one thing — lowering the cost of energy for Americans — and does the opposite.
The final version of the GOP's bill, which Trump signed into law on July 4, phases out clean energy tax credits by the end of 2027, a year earlier than the timeline in the original House version.
Rather than 'unleash' American energy, the Republican Party just kneecapped it. The loss of renewable subsidies threatens to disrupt or cancel a combined capacity of 547 GW of wind and solar by 2027 or later, according to Cleanview's tracker. That's not 'leveling the playing field' with the massively-subsidized fossil fuel industry — it's rigging the game.
While the bill does give some juicy handouts to the fossil fuel industry, it's hard to see who else benefits. U.S. automakers will definitively lose the global electric vehicle race. Big Tech will have to pay a premium to power their AI data centers. Advanced manufacturers now face insurmountable regulatory hurdles. An estimated 2.3 million jobs in clean energy and associated industries will vanish over the next 10 years. The nascent battery manufacturing boom is over. And American households will soon face steep price hikes on their utility bills, with double-digit increases in states like Arizona and North Carolina.
If that wasn't bad enough, in June, Trump stated plainly what he had already put into practice: a total ban on wind energy. 'We're not going to let windmills get built because we're not going to destroy our country any further than it's already been destroyed.' Adding cheap, abundant energy to the grid that would lower costs for working Americans simply isn't worth the eyesore to Trump. Instead, Americans will foot the bill for Trump's aesthetic preferences.
While China added 329 GW of solar last year alone, the U.S. added about 50. Once the tax credits expire, we'll add even less. As energy expert, Doug Lewin, puts it: this isn't energy dominance, it's 'energy submission.'
The Trump administration champions fossil fuels as the energy solution for the modern world — but the industry can't come close to replacing the renewable capacity that would be lost under the GOP's rollback of clean energy incentives.
Demand may be high, but the natural gas industry can't meet it. The cost of building new natural gas plants has already tripled since 2022, with orders for new gas turbines backlogged past 2029. And as Heatmap reports, manufacturers like GE Vernova have little incentive to ramp up production capacity and risk future profit margins due to overcapacity. By 2027, GE will be able to produce only 20 gigawatts' worth of gas turbines per year — worldwide.
These supply constraints won't be fixed anytime soon. CEO John Ketchum of NextEra Energy calculates that natural gas will only be able to make up 16% of the 460 GW of additional capacity needed by the U.S. by 2030. The energy consulting firm, The Brattle Group, found that the combined capacity of new natural gas plants and nuclear plant restarts will only supply about a third of projected peak demand growth by 2030.
And once gas plants are built, unlike wind or solar, their electricity prices are tied to a global market prone to volatility — as Russia's invasion of Ukraine made painfully clear. On top of that, the Trump administration's push to boost LNG exports will only intensify global demand for natural gas and raise prices at home.
The administration's gung-ho nuclear stance also faces headwinds from its own self-defeating policies — like arbitrary staff cuts at the Department of Energy and Nuclear Regulatory Commission — that make building nuclear power more difficult. Not to mention that tariffs on key components, like steel and aluminum, drive up already staggering construction costs — jeopardizing projects like the reopening of the Palisades Nuclear Plant.
The final bill extended the window to claim tax credits for clean, firm power sources like nuclear, hydro, and geothermal for a decade — but this will still be too little, too late to stabilize energy prices. Industry analysts say no new nuclear plant will come online before 2032, at the earliest. And even if it did, the enormous upfront capital costs mean that any cost savings from nuclear appear on the timescale of decades, not years. While states like New York have moved forward with plans for new nuclear in an effort to improve 'reliability and affordability,' the experience of some nuclear customers has been the opposite. Integrating nuclear's constant baseload power may bolster the grid's long-term reliability — but it won't provide any short-term rate relief.
Republicans can idolize fossil fuels all they want, but the industry lacks the physical capacity to expand fast enough to meet demand.
Trump calls windmills 'costly and unsightly.' His Secretary of Energy, Chris Wright, derides net-zero goals as 'sinister.' Interior Secretary Doug Burgum warns that the U.S. has 'tipped' too far towards renewables. In one of the administration's first executive orders, Trump bizarrely claimed that clean energy 'makes worse the high energy prices that devastate Americans.'
These lies are designed to obscure the reality: it's fossil fuels, not renewable energy, inflating energy prices. Sensitive to global markets, the price of natural gas fluctuates wildly in response to supply shocks and geopolitical instability, as the Russia-Ukraine war made painfully clear in 2022. Coal is even worse. In places like West Virginia, Republican regulators have long forced ratepayers to subsidize uneconomic, aging coal plants despite cheaper alternatives. Now, Trump is mandating the rest of the country follow suit.
Republicans are forcing Americans to accept higher utility bills just to prop up a dying fossil fuel industry — one that has already saddled the public with trillions in climate damages while raking in historic profits.
The clean energy transition is unstoppable. Stripping away renewable energy subsidies will only increase costs and slow the pace of adoption. But it won't kill the momentum.