Will Trump’s policies lead to “energy dominance” or more expensive power?
On the campaign trail, President Donald Trump told Americans that surging energy costs would be stopped and prices would be cut in half when he took office. US oil drilling was already at record highs before the election, but the Trump administration has put a renewed focus on fossil fuels and nuclear power. That said, it’s also curtailing long-standing energy efficiency standards and scaling back incentives to speed up the switch to renewables.
To see how it’s going, let’s dig into Trump’s flagship One Big Beautiful Bill Act:
An analysis of the act’s energy provisions by Energy Innovation, a nonpartisan energy and climate think tank, anticipates power generation capacity will actually fall by 340 gigawatts nationally by 2035, with consumers paying up to 18% more for electricity. It also predicted a staggering amount of lost GDP and jobs.
On the other hand, the business-friendly Tax Foundation estimates the bill will create way more jobs overall, though it doesn’t carve out energy-related impacts specifically.
US energy demand has been growing since 2020, spurred partially by Big Tech’s enormous hunger for bigger and more powerful AI data centers. Energy companies are on track to spend over $1 trillion by 2029 to meet that demand, and those costs are being passed down to consumers.
The Rhodium Group forecasts the average household will pay between $78 and $192 more annually; Energy Innovation puts it at an average $170 extra per year.
It’s not just about the cost per watt rising, but a slew of other changes that will raise prices in sneaky ways, as broken down in our scenario of a low-income renter.
Part of the problem is that Trump’s policies minimize renewables, which means more dependence on natural gas plants and therefore higher natural gas costs. Solar plants and wind farms can come online in a year or two, whereas natural gas plants take years longer — especially with a current five-year backlog on a key piece of equipment.
The Takeaway
Whether or not Trump is a fan of wind turbines (we’re kidding, he’s definitely not), tariffs and other measures will make it harder to add the cheapest, most quickly deployed power options to the grid when they’re needed the most.