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How OBBB will impact the power grid [1]
['Maeve Allsup', 'Maeve Allsup Is Latitude Media S Founding Reporter. She Was Previously A Tech Reporter At Morning Brew', 'Where She Covered Tech Policy', 'Regulation', 'As Well As The Ev Industry.', 'Shayle Kann', 'Bianca Giacobone', 'Stephen Lacey', 'Open Circuit', 'Root']
Date: 2025-07-08 18:59:09+00:00
The passage of the GOP tax bill last week is about to dramatically reshape the U.S. clean energy landscape — potentially in as little as 45 days, if President Trump’s Tuesday executive order is anything to go by.
The clean energy industry is already running the numbers. According to initial analysis from several sources, the One Big Beautiful Bill’s energy provisions will have far-reaching consequences for grid capacity, electricity prices, reliability, and economic growth.
And unsurprisingly, it will also come with a climate toll. The change underway is coinciding with massive electricity demand growth, spurred in part by data centers, as well as the onshoring of manufacturing. This jump in demand is already increasing greenhouse gas emissions, with some of the country’s largest tech companies already struggling to keep their impact in check. But according to new data from Princeton’s REPEAT project,the bill will increase U.S. greenhouse gas emissions by roughly 190 million metric tons per year in 2030, and 470 million tons in 2035.
At the same time, the bill is expected to compromise the grid’s ability to meet that growing demand. From now to 2035, here’s how initial research anticipates the bill to impact the U.S. electric grid:
Less new capacity will be added to the grid
The bill accelerates the phaseout of tech-neutral tax credits, and imposes strict material sourcing requirements. According to Energy Innovation, this will cut new generation capacity by a whopping 340 gigawatts by 2035.
The brunt of that cut will be borne by wind and solar, with 200 GW less new wind, and 150 GW less new solar coming online. But it’s not just renewables; Energy Innovation also predicts 17 GW fewer batteries on the grid.
Image credit: Energy Innovation
Natural gas sees a 19 GW increase in Energy Innovation modeling, but supply chain bottlenecks mean no near-term growth, despite the surge in data center and AI-driven demand.
The REPEAT project, a joint initiative between Princeton University and Evolved Energy Research, reached similar conclusions.
According to REPEAT modeling, the bill will reduce new solar capacity additions by around 29 GW by 2030, and 140 GW in 2035, compared to continued Biden-era policies.
Wind will see 43 GW less capacity by 2030, and 160 GW less by 2035. That’s significantly less, the project predicts, than would have come online if President Trump had attempted to use executive actions alone to influence the market.
Image credit: REPEAT Project
REPEAT’s models also show a significant pullback in potential battery deployments, as well as in natural gas projects combined with carbon capture and sequestration. Geothermal, meanwhile, which got a boost in the Senate’s version of the bill, remains on track for pre tax-bill deployment levels.
Wholesale electricity prices will go up. So will household energy bills.
Energy Innovation estimates that wholesale electricity prices will increase by 25% by 2030, and 74% by 2035, costing a total of $230 billion in that year. That’s a jump up from the total $140 billion the group estimates electricity would cost in 2035 under current policy.
Image credit: REPEAT Project
REPEAT estimates that U.S. residential and commercial energy expenditures will increase by more than $50 billion in 2035.
Image credit: REPEAT Project
And for residential consumers, the analysts expect that energy costs will increase by around $165 per household per year in 2030, and by more than $280 in 2035 — a jump of over 13% compared to current costs.
Grid reliability will decline
REPEAT predicts that by 2035, clean electricity generation will fall by more than 820 terawatt-hours. That’s more than the entire contribution of nuclear or coal to the U.S. grid today, all while electricity demand continues to accelerate, driven in large part by data centers.
Image credit: REPEAT Project
The bill will also dramatically reduce investment in the U.S. power sector more broadly. REPEAT predicts cumulative capital investment will drop by half a trillion dollars in the next decade, with the largest drops impacting wind and solar, but also hitting hydrogen and storage.
In the next five years, electric transmission will also see a drop in investment compared to current policy.
Join Latitude Media’s special briefing on the Reconciliation Bill on Thursday, July 10. Senior reporter Maeve Allsup will be live with Jason Clark of Power Brief to discuss the on-the-ground impacts. Register for free.
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[1] Url:
https://www.latitudemedia.com/news/how-obbb-will-impact-the-power-grid/
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