Details about how President Donald Trump’s “One Big Beautiful Bill” will change life for everyday Americans are still emerging more than a month after Congress passed the sweeping legislation.
Even some politicians who voted in favor of the bill, which passed with a razor-thin margin, didn’t understand what it would do. Rep. Marjorie Taylor Greene, R-Ga., said she would have voted against the measure if she had fully understood its contents.
Here in Washington state, energy experts and policy wonks are coming to understand that it’s going to mean higher electrical bills.
Precisely when your bills will rise and by how much remain somewhat unclear. But the tax plan will eliminate single-family tax credits, hand out billions to fossil fuel companies and hamstring the very wind, solar and battery projects Washington state is scrambling to build.
The money lost will soar into the billions, according to some estimates.
In the face of widespread voter opposition, illuminated by numerous polls across the country, Republicans in Congress rallied around the bill, squeezing votes out of even their most squeamish party members. Trump and his allies sold the plan as the “largest tax cut in history for middle- and working-class Americans.”
In reality, the average family earning less than $50,000 would save less than $300 in 2027 under the tax plan, while those earning $1 million or more would save around $90,000, according to an analysis by the nonpartisan Center on Budget and Policy Priorities.
Two House Republicans voted against the measure. Washington’s two GOP representatives, Dan Newhouse and Mike Baumgartner, both voted in favor, and neither responded to requests for comment on the topic.
Democrats repeatedly warned that the bill would cut popular programs like Medicaid and SNAP and add trillions to the national debt. Now that it’s law, there appears to be little they can do to offset damage to the renewable energy industry. Politicians and state and local officials talk about challenging the law in court and raising their voices in opposition. Concrete policy proposals to keep rates from rising are few and far between.
The tax plan, broadly seen as the linchpin to Trump’s agenda during his second term, marks the president’s latest shot in his escalating fight against climate science. He’s doubling down on planet-warming fossil fuels and gutting environmental and climate regulations. The latest move amounts to a setback of gargantuan proportions for the renewable industry that boomed under President Joe Biden.
As the political battle plays out, ratepayers in Washington will be forced to absorb higher electrical bills as the cost to build new wind, solar and battery projects increases by perhaps 30% or more.
“It’s going to impact our jobs; it’s going to make your electricity more expensive,” Joe Nguyễn, who directs Washington’s Department of Commerce, said during a roundtable discussion late last month. “And, candidly, it could make us more risky for brownouts or blackouts.”
Now, Washington state, utilities and developers are scrambling to figure out how to pick up the pieces.
Loss of individual tax credits
The quickest way this bill will hit home for some is with the elimination of residential clean energy credits and similar policies. Those credits might have helped the typical household in Washington save between $390 and $900 a year, Washington’s senior Democratic Sen. Patty Murray said at the roundtable discussion.
People who installed rooftop solar panels, heat pumps or similar devices were eligible for a tax credit worth 30% of their cost, but that offering will end by Dec. 31.
Not only are those potential savings gone but the residential clean-energy market could be cut in half or worse, Murray said.
The bill also eliminates a $7,500 consumer rebate for some electric vehicles and a credit for those seeking to audit their home’s energy use and renovations to become more energy-efficient.
Washington state still offers some incentives for these types of purchases, but the money available pales in comparison to the outgoing federal credits and rebates.
Renewable energy projects in jeopardy
Washington stands to lose an estimated $8.7 billion in clean-energy investments, Murray said.
The tax bill phases out credits for large-scale wind and solar farms or battery storage, eliminating Biden-era subsidies that could have cut costs by nearly a third.
Renewable energy project developers proposing work across the state declined to comment on this article for fear of further attracting Trump’s ire.
Take a project like the Horse Heaven Hills wind farm in Benton County. It was originally estimated to cost about $1.7 billion. A 30% investment credit could have cut costs by around $510 million.
Those credits are now largely out the window. Unless a project can be finished by the end of 2027 or break ground by next summer, it won’t qualify.
For context, the Horse Heaven Hills project took around three years just to win the permits needed to start work, and even then, the size of the wind farm was greatly reduced. The developer is still arguing over part of that project in court.
That truncated timeline could be enough to kill a project outright or dramatically shrink its footprint, Glenn Blackmon, manager of Washington’s Energy Policy Office, said in an interview. Other developers might back out because the finances no longer pencil out.
Ultimately, Washington is likely to lose renewable energy projects because of the added complications, Blackmon said.
That’s a problem because Washington needs more clean energy to replace outgoing fossil fuel sources and meet surging demand made and the increasing prevalence of power-hungry data centers.
Whatever renewable projects still make it through the pipeline will be more expensive, and that added cost will be passed on to ratepayers, Blackmon said.
“It doesn’t take a real fancy economic model to think ‘Well, if you increase the price by 30% or 40%, then the cost of electricity is going to be higher,’ ” Blackmon said.
But why must Washington move forward with only renewable energy projects?
The Clean Energy Transformation Act
The first answer to that question is climate change. Fossil fuels like coal, oil and gas are warming our planet. So in 2019, lawmakers in Washington passed the Clean Energy Transformation Act, or CETA for short.
Among other things, CETA requires coal plants in Washington to be closed by the end of the year and it requires the state to free its electrical grid of greenhouse gas emissions by 2045.
So any new energy projects built to meet the rising demand must tap into renewable sources like wind or solar. Hydropower is also on the table, but proposals for new dams are few and far between, and the resource is also suffering from ongoing drought conditions fueled by global warming.
For Seattle City Light, rising demand means the utility must double the amount of available electricity in the next nine years, CEO Dawn Lindell said at the roundtable discussion. Not only will the tax plan hike the cost of all that new energy by perhaps as much as 20% but it’s also a step in the wrong direction for a rapidly warming planet.
“Now is not the time to put our head in the sand,” Lindell said.
Puget Sound Energy, the state’s largest utility, is in a similar position, said Matt Steuerwalt, the utility’s vice president of external affairs. Regardless of whether the tax incentives are revoked, the utility must buy more renewable energy. Once those projects begin generating power, that added cost will then be reflected in customers’ bills, he said.
While the loss of these tax incentives will mean prices trend upward, Blackmon said there might be a silver lining. Fossil fuel prices remain volatile while renewables are trending downward. So in the long run, Washington’s transition toward wind and solar will still be the more affordable option.
