The One Big Beautiful Bill Act Is Crushing America’s Electricity System

The U.S. power system is growing for the first time in decades—almost entirely as a result of new clean electricity sources. In 2024, the United States added 49 gigawatts (GW) of new capacity for the grid, and 95 percent of that came from new solar, batteries, nuclear, and wind power. By the end of 2025, the United States is on track to add almost 60 GW of clean energy to the grid. If the Senate agrees to the House-passed One Big Beautiful Bill Act, which would end federal clean energy incentives, the rate of new clean energy additions to the U.S. power grid could be slashed to as little as 13 GW per year over the next decade. By 2035, that would eliminate up to 72 percent of all new clean electricity that would have been built under current law and reduce overall energy additions to the grid by at least 50 percent, according to the latest energy systems modeling from the Rhodium Group.¹ Continued federal clean energy investments are crucial for the grid to meet growing energy demand.

In contrast, repealing clean energy investments would cause the following harms:

• Electricity bills for households would increase by $110 in 2026 and go up 10 percent for businesses.
• Investors could pull back more than $500 billion of unspent investment in U.S. manufacturing.
• 840,000 jobs for Americans would be at risk from downsized investments and canceled projects across the country.
• Grid reliability and energy supply could face new challenges, as data centers are estimated to account for almost half of electricity demand growth by 2030 and new energy supply is lagging.

The future capacity of the U.S. power grid is at stake

ClimateDeck data from the Rhodium Group shows that in the decade before the Inflation Reduction Act (IRA) was enacted, an average of only 15 GW of solar, wind, and batteries were added to the grid each year. By comparison, natural gas added 4 GW per year in the same period, and all other sources of electricity either shrank or remained relatively constant.²

Then, in 2024, powered by the clean energy investment incentives of the IRA, the combined deployment of solar, wind, and batteries tripled, with 45 GW of clean energy added to the grid last year. The explosion in clean energy investment is set to add 58 more GW to the grid this year. In the coming decade, CAP’s analysis found, deployment of these key technologies is projected to surge to an average rate of almost 100 GW per year, or even up to 170 GW per year in 2035.³ This construction boom integrated strong labor standards incentivized by the IRA, and is on track to build a grid that would supply up to 88 percent of its electricity without any fossil fuel costs by 2035⁴—cutting pollution and alleviating electricity prices even as the grid grows to supply the increasing power demands of the modern economy.

Yet the Senate is considering legislation that would hinder this progress. Under the House-passed reconciliation bill, which terminates federal clean energy investment, additions to the electricity grid would crater. Energy Innovation’s recent analysis of the One Big Beautiful Bill Act finds that it would cause new electricity additions to fall to roughly 33 GW per year by 2035, or 330 GW total. Similar ranges in energy capacity loss are reflected in the Rhodium Group’s multi-scenario analysis on clean energy tax credit repeal, which shows that the average annual deployment of solar, wind, and storage would likely fall down to 34 GW or even to as little as 13 GW under certain conditions.⁵ As much as 72 percent of all clean energy capacity that would have been built over the next decade would disappear.

Nuclear power, which added 1.1 GW of new capacity last year after the decades-long process to build the Vogtle power plant, may, if not affected by the One Big Beautiful Bill Act, add another 4 GW of new capacity over the coming decade due to the federal incentives for new emissions-free power.⁶ This technology-neutral approach to supporting clean energy has also justified private investment in research to develop fusion power, enhanced geothermal, and other innovations. Without the federal incentives, no new nuclear power is projected to be built in the coming decade.

The loss of new clean electricity capacity will not be fully replaced by new gas or other energy sources. Gas developers are facing growing costs and long wait times for projects to come online, with many not slated to deliver power until 2030 or later, as it takes seven years, on average, to build a new natural gas power plant. Time delays in equipment procurement caused the withdrawal of a large gas project in Texas earlier this year. Without federal clean energy incentives, economic projections indicate that annual new baseload natural gas capacity additions could increase by as little as 0.8 GW per year in response to the lost solar, wind, and battery storage—and without federal incentives, little or none of that new natural gas capacity would bother to capture and sequester carbon.⁷ In the best-case scenario for natural gas, under which data center growth for artificial intelligence is most rapid and clean energy investment is repealed, an average of 10 GW of new baseload natural gas capacity would be added annually.⁸ In place of the new clean affordable electricity that would have been built, new and existing power plants would be called on to generate more power, unnecessarily consuming expensive and polluting fuel.

Taken together, more than half of all new capacity added to the grid over the next 10 years will be lost if federal clean energy investment is terminated.

The House Republican plan has consequences for the power grid and cost of living

The proposed cuts to the federal clean energy incentives would not only limit new clean energy additions to the grid but would have cascading effects throughout American society.

Increase electricity bills for households by $110 per year

Gutting clean energy investment at the federal level would hand Americans even higher electricity bills, raising prices by 7 percent for households and by 10 percent for businesses next year. If energy tax incentives are repealed, U.S. households would bear an average increase of $110 in electricity costs in 2026. In the next decade, Energy Innovation projects an average $260 increase in Americans’ energy bills every year, but by 2035, some states, such as South Carolina and Kentucky, could see even higher average annual increases of more than $800. The nation’s commercial and industrial sectors would also be hit by repeal and see double-digit percentage increases in electricity prices in nearly half of U.S. states in 2026. With 4 out of every 5 Americans feeling “powerless” about their skyrocketing energy bills, removing federal clean investment would only leave more households in financial distress.

Risk more than $500 billion of unspent investment in the U.S. manufacturing industry

In addition to raising electric rates for manufacturers, House Republicans’ proposed legislation would suddenly pull the rug out from under billions of dollars of transformational investments. As of early May 2025, a more than $500 billion investment in manufacturing and clean energy deployment had been announced but not yet spent; gutting the federal incentives that form the basis of project financing would put these investments at risk. These cuts would forfeit the United States’ competitive edge in the clean energy industry and auto supply chain created by the IRA—leaving ample opportunity for other nations, such as China, to out-produce and out-innovate the United States.

Create difficulties for grid support of data centers

Data centers, driven by purported artificial intelligence services, could account for almost half of the United States’ electricity demand growth by 2030. If power-hungry AI data centers are built and clean energy is not, Americans will bear the costs of higher rates and utility bills. Repealing energy tax credits could cause the nation to struggle with transforming its data centers from grid burdens to grid assets as well as risk the competitiveness of its digital infrastructure.

Cut 840,000 jobs for Americans

Repealing clean energy investments would undercut thousands of clean energy projects and  lead to 840,000 lost jobs by the end of the decade and 790,000 lost jobs in 2035. These losses would be largely due to faltering domestic investment in clean energy, shuttered manufacturing facilities, and canceled construction projects, leading to a cumulative $1.1 trillion loss in gross domestic product (GDP) within the reconciliation budget window of 2025 to 2034.

Conclusion

House Republicans’ One Big Beautiful Bill Act would reduce the capacity of America’s power system, threatening cost of living, jobs, competitiveness, and the climate.

The authors would like to thank Ben King and Hannah Hess at Rhodium Group, as well as Shannon Baker-Branstetter, Kat So, and Meghan Miller at the Center for American Progress, for their contributions and review.