Would you rather have cheap energy, or stupid culture wars?

Trump's "Big Beautiful Bill" is an attack on American energy production.

Photo by Digitmed via Wikimedia Commons

There are many things to despise about Trump’s deeply unpopular budget bill, known as the One Big Beautiful Bill, or BBB. It would expand the national debt to dangerous levels with irresponsible and unnecessary tax cuts. It would shift the distribution of income upward. But perhaps the most ridiculous, pointless, and downright insane feature of the BBB is its attack on American energy supply.

Previous versions of the BBB eliminated government subsidies for solar and wind energy. The new version now being debated in the Senate would actually add a tax on solar and wind energy. Politico reports:

Senate Republicans stepped up their attacks on U.S. solar and wind energy projects by quietly adding a provision to their megabill that would penalize future developments with a new tax…The new excise tax is another blow to the fastest-growing sources of power production in the United States, and would be a massive setback to the wind and solar energy industries since it would apply even to projects not receiving any [tax] credits…

Analysts at the Rhodium Group said in an email the new tax would push up the costs of wind and solar projects by 10 to 20 percent — on top of the cost increases from losing the credits…

The provision as written appears to add an additional tax for any wind and solar project placed into service after 2027…if a certain percentage of the value of the project’s components are sourced from prohibited foreign entities, like China. It would apply to all projects that began construction after June 16 of this year.

The language would require wind and solar projects, even those not receiving credits, to navigate complex and potentially unworkable requirements that prohibit sourcing from foreign entities of concern — a move designed to promote domestic production and crack down on Chinese materials.

In keeping with GOP support for the fossil fuel industry, the updated bill creates a new production tax credit for metallurgical coal, which is used in steelmaking.

Jesse Jenkins, a widely respected energy modeler and Princeton engineering prof, has estimated how much this GOP bill would raise taxes on solar energy, and it’s a lot:

Later in his thread, he explains how he arrived at these estimates.

But it gets worse! As Jenkins notes, the bill would also tax nuclear and geothermal energy and battery storage, and subsidize the coal industry:

The new draft of the 'One Big Beautiful Bill'…now contains FOUR tax increases on wind & solar projects — and two facing nuclear, geothermal, and batteries.

1. It ends tax cuts for wind & solar projects…

2. It kills accelerated depreciation available to wind & solar investments since 1986…

3. ⁠It imposes a new tax on wind & solar projects…

4. Raises taxes on US wind manufacturers…

The bill ALSO raises taxes on batteries, geothermal and nuclear projects that can't meet significant, burdensome requirements to prove not a drop of Chinese content as well. And they all lose accelerated depreciation too it seems…

The kicker: the bill raises taxes on the electricity technologies of the future while ALSO creating a new subsidy for coal used for steel making, coal that we…export to China so they can dump cheap dirty steel on the global market! THAT is the GOP's plan for energy dominance??…

And of course, it does that while murdering 100s of US manufacturing projects set to employ 100s of thousands of Americans in good paying jobs building the energy technologies of the future.

Michael Thomas of Clearview Energy, a company that tracks energy-related data, estimates that this bill will lead to the cancellation of more than 500 GW of planned energy supply in the U.S.:

Source: Michael Thomas

That would have represented more than a 42% increase in U.S. electricity production, and it would have gone to power homes, factories, offices, data centers, and more. Now, under Trump’s budget, that will all be gone. Thomas estimates that this will lead to substantial increases in electricity bills for Americans:

Source: Michael Thomas

CNN has an interactive tool that allows Americans to see how much their energy bills could go up if Trump’s BBB passes, according to estimates from the think tank Energy Innovation. They write:

Red states including Oklahoma, South Carolina and Texas could see up to 18% higher energy costs by 2035 if Trump’s bill passes, compared with a scenario where the bill didn’t pass…Annual household energy costs could rise $845 per year in Oklahoma by 2035, and $777 per year in Texas. That’s because these states would be set to deploy a massive amount of wind and solar if Biden-era energy tax credits were left in place. If that goes away, states will have to lean on natural gas to generate power.

Trump’s bill wouldn’t just make energy more expensive; it would make it less reliable too. In Texas, adding solar and batteries to the grid has allowed it to avoid blackouts. This is from the New York Times last year:

During the scorching summer of 2023, the Texas energy grid wobbled as surging demand for electricity threatened to exceed supply. Several times, officials called on residents to conserve energy to avoid a grid failure.

This year it turned out much better — thanks in large part to more renewable energy.

The electrical grid in Texas has breezed through a summer in which, despite milder temperatures, the state again reached record levels of energy demand. It did so largely thanks to the substantial expansion of new solar farms.

And the grid held strong even during the critical early evening hours — when the sun goes down and the nighttime winds have yet to pick up — with the help of an even newer source of energy in Texas and around the country: batteries.

The federal government expects the amount of battery storage capacity across the country, almost nonexistent five years ago, to nearly double by the end of the year. Texas, which has already surpassed California in the amount of power coming from large-scale solar farms, was expected to gain on its West Coast rival in battery storage as well.

Here are some quotes from the CEO of ERCOT, Texas’ grid operator, which explain why adding solar and batteries makes electricity more reliable:

A little over 9,000 megawatts of new energy coming online, new supply. The bulk of that is in the solar and energy storage categories…Those are extremely helpful during the summer seasons…The peak in the summer of course is in the afternoon at the peak heat when air conditioning load is at its highest. Solar energy is very well suited to help support that. Energy storage resource is very well positioned to help during the evening ramps…We are seeing as a result of this that the peak risk hour which is generally around 9 PM in the summer evenings, that the risk of emergency events during that hour is shrinking, dropping from over 10% a year ago to under 1% this year, again because of the… new resources.

And of course nuclear and geothermal, which Trump also wants to raise taxes on, are among the most stable energy sources that exist.

It’s also notable how many GOP districts and red states would be hurt by this disastrous policy. Although I don’t believe the purpose of industrial policy should be to create jobs, it’s undeniable that the boom in solar, wind, and batteries has generated a ton of economic activity in Republican-leaning areas.

Why would Trump and the GOP Congress want to raise energy prices for Americans, make electricity less reliable, and destroy their own voters’ jobs? One possibility is that the GOP is captured by fossil fuel interests, which could explain why the BBB goes after nuclear and geothermal as well as renewables. Although I think this is probably true of some representatives and senators, I don’t think Trump himself is captured by Big Fossil Fuels — especially because he was perfectly willing to hurt those industries with his tariffs.

I find two additional reasons to be especially compelling:

1. Trump and his people are deeply ignorant and misinformed about how energy works, and

2. Trump and his people see attacks on solar, batteries, and other non-fossil-fuel energy technologies as part of a culture war against progressive culture, which often overrides economic concerns.

Trump’s budget bill claims a national security justification for its taxes on solar, batteries, nuclear and geothermal — it frames the taxes as being about blocking imports from China. But in his public communications, Trump’s Energy Secretary Chris Wright makes it clear that the real goal is to attack new energy technologies themselves:

How much would you pay for an Uber if you didn’t know when it would pick you up or where it was going to drop you off? Probably not much…Yet this is the same effect that variable generation sources like wind and solar have on our power grids…You never know if these energy sources will actually be able to produce electricity when you need it — because you don’t know if the sun will be shining or the wind blowing…Even so, the federal government has subsidized these sources for decades, resulting in higher electricity prices and a less stable grid.

President Donald Trump knows what to do: Eliminate green tax credits from the Democrats’ so-called Inflation Reduction Act, including those for wind and solar power…As secretary of energy — and someone who’s devoted his life to advancing energy innovation to better human lives — I, too, know how these Green New Deal subsidies are fleecing Americans…Wind and solar subsidies have been particularly wasteful and counterproductive…

Climate change activists are predictably up in arms over efforts to end the subsidies…

If sources are truly economically viable, let’s allow them to stand on their own, and stop forcing Americans to pick up the tab if they’re not. [emphasis mine]

Wright’s statements — which we should assume speak for the Trump administration and the BBB’s supporters in general — make three things clear.

First, Trump and GOP leaders deeply and honestly believe that non-fossil-fuel energy sources are unreliable. This is because they’re grossly misinformed. They have not examined the data from Texas’ positive experience with solar and batteries. They do not understand how much batteries have come down in cost, and how much cheaper they could get. They do not understand the basic fact that batteries can also be charged by natural gas plants, meaning that batteries make the grid more reliable no matter how the power is being produced.

This is partly because the Trump administration, and the GOP leadership, are trapped in an information bubble in which they only hear from people who bash solar and batteries. Consider this tidbit from a recent NYT article:

Alex Epstein, an author and founder of a think tank that argues fossil fuels are crucial for human prosperity, is one of the most influential figures calling for the permanent elimination of all clean-energy subsidies by 2028…He has described wind and solar subsidies as “immensely harmful” to the nation’s power grid and “a cancer we have to get rid of.”…In a recent interview on Mr. Epstein’s podcast, Representative Chip Roy, Republican of Texas, said wind and solar jobs made the United States “weaker” and likened subsidies that create such employment to the drug trade. Mr. Epstein agreed, calling them “fentanyl jobs.”

These are the kinds of people that Trump is listening to. They are not serious, respected, or honest energy modelers like Jesse Jenkins. They are polemicists who have a fixed belief that solar and batteries are bad, and they have never updated this belief in light of the incredible cost declines for those technologies.

Second, it’s clear that Trump and the GOP leadership think the main purpose of solar and batteries is to reduce carbon emissions to fight climate change. Their statements about these technologies constantly reference “climate”. The notion that solar and batteries actually make energy cheaper for Americans, with or without climate change, has not entered the collective Republican consciousness yet.

And finally, it’s clear that Trump and the GOP leadership see their attacks on American energy supply as part of a culture war rather than purely economic policy. This is apparent from Wright’s gleeful mention of how angry “climate change activists” will be at Trump’s bill. It’s also obvious from the words like “cancer” and “fentanyl” that opponents of solar and batteries use to describe those technologies. And from the disingenuousness of Wright’s argument — he says solar and batteries should “stand on their own”, while trying to levy heavy taxes on them — we should conclude that there are deeper motivations at work than pure dollars and cents.

Basically, most of the GOP decided long ago that solar and batteries were some hippy-dippy bullshit that lefty activists were trying to force on America in order to bring down capitalism. And they have simply not reconsidered, looked at new evidence, or updated their belief in decades, even as advances in solar and battery technology have utterly changed the game. They are confident that attacking solar and batteries won’t hurt the U.S. economy, and so will give them an easy, safe way to own the libs.

One Republican who clearly does understand both the power and the importance of solar and batteries is Elon Musk, who has been tweeting relentlessly against Trump’s bill, and who makes many good points about the importance of new energy technologies. For example:

And also:

Musk knows that if AI data centers can’t get batteries, they can’t operate cheaply in the U.S. And if data centers leave the U.S., China will have a much easier time winning the AI race.

But Trump and his people are not listening to Musk. They are not listening to anyone, except to ignorant fawning toadies who flatter their existing beliefs and insult their enemies for them. Their fingers are stuck firmly in their ears, so they won’t hear the sounds of catastrophe as they kick over the physical foundations of American prosperity.

This was also the pattern we saw with tariffs, an act of national self-sabotage Trump only paused when the bond market threatened to demolish the entire U.S. economy before Trump’s term was up. This time, bond markets are unlikely to intervene, since the threat comes from a stolen future rather than a disrupted present.

The American people, for the most part, get the general gist of Trump’s ideology-driven approach to economic policy, and they’re not happy about it. Poll after poll shows that even many Republicans despise the One Big Beautiful Bill. This is from NBC a few days ago:

Nonpartisan polls released this month show that voters have a negative perception of the bill…A Fox News poll found that 38% of registered voters support the “One Big Beautiful Bill” based on what they know about it, while 59% oppose it.

The survey found that the legislation is unpopular across demographic, age and income groups. It is opposed 22%-73% by independents, and 43%-53% among white men without a college degree, the heart of Trump’s base.

A Quinnipiac University poll found that 27% of registered voters support the bill, while 53% oppose it. Another 20% had no opinion. Among independents, 20% said they support it and 57% said they oppose it.

A KFF poll found that 35% of adults have a favorable view when asked about the “One Big Beautiful Bill Act,” while 64% have an unfavorable view. Just 27% of independents said they hold a favorable view of it.

A survey from Pew Research Center found that 29% of adults favor the bill, while 49% oppose it. (Another 21% said they weren’t sure.) Asked what impact it would have on the country, 54% said “a mostly negative effect,” 30% said “a mostly positive effect” and 12% said “not much of an effect.

A poll by The Washington Post and Ipsos found that 23% of adults support “the budget bill changing tax, spending and Medicaid policies,” while 42% oppose it. Another 34% had no opinion.

The bill’s self-defeating policies are probably only a small part of this, especially since the Senate version of the bill — which actively taxes new energy technologies instead of just removing subsidies — hadn’t even been released when these polls were taken. Debt increases, Medicaid cuts, and tax cuts for the rich are driving these negative polls. But if and when Americans realize that the GOP is also trying to make their energy bills go up in order to fight a stupid outdated culture war, I expect them to sour on the bill even further.

But I’m not sure how much that will matter. Trump and the GOP leadership have shown that appeasing public opinion is very low on their list of priorities.

This is a recipe for national failure. Countries that turn their back on the march of technology — whose leaders insist on ignoring extant reality in favor of internecine status battles and feuds — have historically declined, while countries that embrace technological progress and bow to physical realities have dominated. Right now, the country that is embracing progress and bowing to physical realities in the energy space is China, not America.

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