Congress hears warnings that cutting renewable energy incentives could drive up costs

Energy experts told lawmakers that rolling back Biden-era tax credits for renewables could slow grid expansion, raise electricity costs, and make it harder to meet surging energy demand.

Katie Surma reports for Inside Climate News.


In short:

  • The U.S. is facing an unprecedented rise in electricity demand due to artificial intelligence, manufacturing growth, and electrification.
  • The Trump administration has moved to halt funding for clean energy incentives, prompting concerns from utilities and grid operators that this could undermine reliability and drive up costs.
  • A study found that repealing clean energy tax credits could raise residential electricity bills by 7% and business costs by 10% by 2026.

Key quote:

“I mean, it’s sort of obvious, right? If you pull back incentives for a given activity, you’re going to see less of that activity. In this case, that means there’s going to be less generation out of the system, and it’s going to impose higher costs.”

— Tyler H. Norris, James B. Duke Fellow at Duke University

Why this matters:

Energy demand is rising fast, driven by AI-powered data centers and increased electrification. While renewables are expanding, traditional fossil fuel plants still provide a significant power source. Cutting tax credits for wind, solar, and nuclear energy could slow grid modernization and raise costs, potentially leading to reliability issues and higher prices for consumers. With extreme weather events straining power grids, decisions about energy investment could shape the country’s ability to keep the lights on.

Related: US energy secretary pushes nuclear power as AI-driven energy demand rises

Solar panels juxtaposed against transmission lines and wind turbines
Credit: kckate16/ BigStock Photo ID: 478351339

Clean energy companies are trying to survive the Trump era

Offshore wind is out. Geothermal power is in. And many climate technology startups are looking for ways to carry on without federal backing.

Lines of morse code in red and black

To keep climate science alive, researchers are speaking in code

Words considered "woke" are vanishing from National Science Foundation proposals. Grist tracked the changes.
 Solar panels, wind turbines and nuclear power plant cooling towers
Credit: jaroslavav/BigStock Photo ID: 83377346

Solar is winning the energy race

The world’s cheapest power source is scaling at warp speed, pushing coal, gas, and nuclear aside.

A person with their hand outreached with an AI illustration hovering over it

Tech company climate goals under pressure due to AI energy demand

Tech companies set ambitious climate goals at the start of the decade, promising to slash emissions that contribute to global warming.

City of Murmansk

Worries grow in Norway as Murmansk becomes Russia's main oil export hub

Massive drone attacks this week on the major Baltic terminals of Primorsk and Ust-Luga have left Russia with few remaining routes for exporting oil, increasing reliance on the Kola Peninsula. In Norway, concerns are growing over the ecological risks posed by ageing “shadow fleet” tankers operating along the coast.
Snow-covered fossil fuel pipeline leading to a refinery.

How to build a pipeline in Canada’s frozen, shifting North

An oil crisis and shifting permafrost: they’re challenges now, and they were challenges in 1947, when the first pipeline was built across the Canadian North.

An illustration of a dying tree with a long pinnochio nose

How a gas price ‘expert’ is using the Iran war to mobilize Canadians against climate action

Dan McTeague cultivates a media image as a consumer advocate while running a group urging people to fight against climate policies.
From our Newsroom
Multiple Houston-area oil and gas facilities that have violated pollution laws are seeking permit renewals

Multiple Houston-area oil and gas facilities that have violated pollution laws are seeking permit renewals

One facility has emitted cancer-causing chemicals into waterways at levels up to 520% higher than legal limits.

Regulators are underestimating health impacts from air pollution: Study

Regulators are underestimating health impacts from air pollution: Study

"The reality is, we are not exposed to one chemical at a time.”

Pennsylvania governor Josh Shapiro speaks with the state flag and American flag behind him.

Two years into his term, has Gov. Shapiro kept his promises to regulate Pennsylvania’s fracking industry?

A new report assesses the administration’s progress and makes new recommendations

silhouette of people holding hands by a lake at sunset

An open letter from EPA staff to the American public

“We cannot stand by and allow this to happen. We need to hold this administration accountable.”

wildfire retardants being sprayed by plane

New evidence links heavy metal pollution with wildfire retardants

“The chemical black box” that blankets wildfire-impacted areas is increasingly under scrutiny.

Stay informed: sign up for The Daily Climate newsletter
Top news on climate impacts, solutions, politics, drivers. Delivered to your inbox week days.