Clean energy hurt but resilient one year after GOP budget law
Add Axios as your preferred source to
see more of our stories on Google.
Illustration: Gabriella Turrisi/Axios
The GOP budget law that President Trump signed a year ago has darkened the outlook for several clean energy sources, but stopped far short of strangling low-carbon tech.
Why it matters: It's part of a broader attack on Biden-era climate policies, along with Trump's executive moves to kill regulations and slow permitting of renewables projects.
- The law signed July 4, 2025, phased out wind, solar, and electric vehicle subsidies that Biden officials called key tools for slashing emissions and boosting U.S. clean tech industries.
The big picture: EVs were down to 5.9% of new U.S. car sales in the second quarter of 2026, per Cox Automotive — about two percentage points lower than a year ago.
- 🪁 On wind power, BloombergNEF's U.S. forecast for gigawatts of new power-generating capacity through 2035 is 42% lower than its outlook before the law. The research firm also pared back solar growth forecasts.
- 🏭 On manufacturing, the U.S. has seen billions of dollars in project cancellations spanning batteries, EVs and industrial decarbonization equipment, per joint tracking from MIT and Rhodium Group researchers.
Yes, but: Rising power demand overall — including Big Tech's voracious energy needs in particular — is offsetting some of the headwinds the 2025 law created.
- "The clean energy industry in the U.S. is ... certainly doing worse than it would have, but it is still doing quite well, particularly in the case of the clean power sector," said Nick Nigro, founder of research and advisory firm Atlas Public Policy.
- "Everyone in the industry will tell you the fastest way to get power onto the grid right now is with renewables and batteries," Nigro, whose firm analyzes manufacturing and clean energy generation projects, said in an interview.
State of play: BloombergNEF has upwardly revised its long-term outlook for onshore wind and grid-scale solar projects since its initial post-law forecasts, though its estimates remain well below what would have occurred without the 2025 law.
- Its mid-May analysis for wind installations in 2026-2035 is 13% above what it first projected after the law passed.
The intrigue: One thing analysts will keenly watch is the pace of new wind and solar project plans, now that eligibility for tax credits lapsed earlier this month.
- Developers rushed to get projects under construction ahead of the deadline.
Reality check: Some humility is in order here! It's impossible to completely isolate the law's effect in the stew of market and policy forces that affect these industries.
- Think, for instance, slower EV demand growth than some analysts and automakers expected even before the law killed subsidies.
What we're watching: For the global climate, the big story is what the law didn't scuttle, writes Council on Foreign Relations energy scholar David Hart.
- Surviving credits for costlier, less mature tech — advanced geothermal and nuclear, and battery storage — mean the U.S. is setting the stage for more global projects down the road.
"If the [U.S.] covers the relatively high costs at the front end of this 'learning curve,' the rest of the world might be able to afford them at the back end," Hart argues.
