President Donald Trump’s “One Big Beautiful Bill,” signed into law on the Fourth of July, is expected to hinder clean energy growth in Texas, potentially increasing annual energy costs for residents by hundreds of dollars, according to industry associations and energy researchers.
The bill’s most significant impact on the clean energy industry is the aggressive phasing out of federal tax credits for solar and wind projects. These credits were substantially expanded under former President Joe Biden’s 2022 climate legislation. Without these tax credits, clean energy developers will face difficulties securing funding, leading to the potential abandonment of many projects. Harry Godfrey, a managing director at Advanced Energy United, a clean energy trade group, noted, “We are, in essence, pulling the rug out from underneath these projects.”
However, various groups hold differing views on the new law’s potential damage to the industry. Texas currently has the most future solar and wind capacity planned and already leads in renewable energy production.
One model by Energy Innovation forecasts a significant reduction in electricity capacity for Texas. The state could miss out on 77 gigawatts of electricity capacity—enough to power over 19 million homes—that might have been built over the next decade if tax credits were maintained. This means Texas is projected to add only 27 gigawatts of new electricity supply in the next ten years, instead of the anticipated 104 gigawatts. Dan O’Brien, a senior analyst at Energy Innovation, stated, “Texas is by far the biggest loser,” with Florida ranking second, potentially losing 50 fewer gigawatts.
While the clean energy lobby in Texas successfully blocked state-level bills that would have harmed their industry by arguing against increased energy costs and rolling blackouts, similar appeals failed in Washington. Republican lawmakers prioritized other aspects of Trump’s bill, such as tax cuts and immigration enforcement. Trump has also publicly criticized renewable energy, calling it “unreliable” and “foreign controlled,” and stating, “We don’t want wind, and we don’t want solar, because they’re a blight on our country. They hurt our country very badly.”
Potential Texas Impacts
A substantial decrease in new power supply could negatively affect Texas’s ability to attract energy-intensive artificial intelligence data centers and other factories. O’Brien warns that electricity prices could surge if demand outpaces supply. Energy Innovation’s models predict annual household energy bills in Texas could rise by $220 by 2030 and $480 by 2035 due to the Big Beautiful Bill.
The Trump administration counters that the bill will lower energy costs by making fossil fuel production cheaper and easier, and by streamlining regulations to power the AI boom with advanced nuclear technologies and abundant natural gas.
In the short term, clean energy companies nationwide are expected to expedite their projects. The Big Beautiful Bill allows projects that begin construction within the year or operate by the end of 2027 to remain eligible for federal tax credits. After this period, the extent of the decline in new wind and solar development is uncertain, though industry associations in Texas are more optimistic than Energy Innovation.
Mark Stover, executive director of the Texas Solar and Storage Association, believes solar and energy storage technologies will remain competitive, especially given Texas’s growing electricity demand. The Texas power grid operator forecasted a 70% increase in electricity demand by 2031 during peak hours. Stover also noted the ease of building infrastructure in Texas, stating, “If there’s a state that can absorb the blow from D.C. and find a path forward, I believe it’s Texas.”
Potential Job Impacts
Godfrey expressed concern that reduced solar and wind projects in the U.S. will decrease demand for domestically-made components, impacting manufacturing factories in Texas, some of which have created thousands of jobs in the Houston region.
Energy Innovation projected that Texas could lose 94,000 jobs by 2035 that would have materialized without the Big Beautiful Bill. These jobs would have been in the construction of solar and wind farms and manufacturing across the clean energy supply chain. Republican lawmakers, including Texas Rep. Chip Roy, have stated that wind and solar jobs make the country “weaker.”
O’Brien explained that the clean energy boom initiated by the Biden climate law was still in its early stages, meaning many projects and factories supported by tax credits had yet to be built. He clarified that the job losses would be in potential future positions rather than existing ones, leading to “less blowback on politicians because of that.”
Despite the new law, existing solar manufacturers in Texas are proceeding with their plans. Russell Gold, a spokesperson for T1 Energy, confirmed the continued construction of their new solar factory near Rockdale, capable of producing five gigawatts of solar panels annually. Similarly, representatives from Houston-area manufacturers Elin Energy, Imperial Star Solar, and PV Hardware stated they are moving forward with expansion plans as developers rush to acquire solar parts before federal tax credits expire. All manufacturers anticipate continued demand for American-made solar panels even after the credits end.
