What Trump’s big bill means for clean energy in Washington

Just as Washington state’s need for clean and renewable electricity ticks sharply upward, Congressional Republicans voted to slash the very tools the federal government has used to encourage green energy projects and to incentivize people to buy things like electric vehicles and solar panels.

Voting along razor-thin margins, Congress approved a huge spending bill championed by President Donald Trump on Thursday. It extends tax cuts passed in Trump’s first term and includes new ones, greatly increases spending on immigration enforcement and offsets some of this new spending with cuts to Medicaid, food assistance and a series of clean energy tax breaks.

The pullback on clean energy support has public officials, energy experts and green industry leaders across Washington state bracing for a devastating blow. They say this bill will result in higher electric bills, a less-reliable grid, an overhaul of the renewable industry and the death or delay of major wind, solar and battery projects.

In Washington, it puts at least $8.7 billion in clean energy investments at risk, according to Gov. Bob Ferguson. An estimated 21,800 Washingtonians would lose their jobs by 2030 due to the bill’s reduction in clean energy and manufacturing tax credits, and Washington household electricity costs could go up by $115 per year by 2029, according to an assessment from the U.S. Climate Alliance, a group of mostly Democratic governors.

The legislation serves as the latest example of Trump’s attack on climate science. He has repeatedly placed his thumb on the scales in favor of coal, natural gas and other fossil fuels churning out planet-warming greenhouse gasses.

Democrats rallied against the measure but Washington’s two Republican House members – Dan Newhouse and Mike Baumgartner – supported the legislation. Newhouse and Baumgartner didn’t respond to requests for comment on the cuts to the tax credits.

“Republicans’ bill also makes detrimental and utterly shortsighted cuts to clean energy tax credits, raising families’ energy bills and eliminating millions of manufacturing jobs across the country,” Sen. Patty Murray, D-Wash., said in a statement.

State Rep. Joe Fitzgibbon, D-West Seattle, sees no benefits to Trump’s mega bill, only pain.

“Washingtonians can expect more blackouts but at least they’ll have less health care and higher deficits,” said Fitzgibbon, who is also House majority leader.

Dinner table economics

Generally, energy analysts are in agreement that the legislation will raise energy costs for households across the country, in part because of higher dependence on fossil fuels and higher fossil fuel prices.

According to an analysis by think tank Energy Innovation, the bill will raise the cost of wholesale electricity by 14% by 2035. The think tank also estimated annual energy costs will increase modestly – $39 by 2030 and $55 by 2035 per year.

Cuts to incentives for electric heat pumps, rooftop solar panels and more-efficient insulation or water heaters will mean federal funds will no longer be available for people wanting to upgrade their homes or businesses, said Charlee Thompson, a policy analyst for the nonprofit NW Energy Coalition.

As summers trend hotter and hotter, people struggling to maintain the temperature in their homes and offices will continue to swelter, Thompson said.

Not only will investment in things like heat pumps slow but so too will electric vehicle purchases or the installation of charging infrastructure, Fitzgibbon said. State incentives will remain in place, funded through things like the Climate Commitment Act, but without federal money to supplement those dollars won’t stretch nearly as far.

The Port of Seattle also said in a statement that the legislation will slow its efforts to decarbonize and transition toward electrifying its vehicles and buildings.

Congress axed the $7,500 incentive for buying an electric vehicles, and $4,000 incentive for used ones. People interested in taking advantage of the credits have until Sept. 30 before they disappear.

These cuts will likely delay the growth of electric vehicles, not end it, said Matthew Metz, founder and co-executive director of Seattle-based electric vehicle advocacy group Coltura.

The charging infrastructure is improving, and the cost of building them is going down, Metz said, “I think pretty much everyone agrees, or a lot of auto industry observers agree that EVs will become the predominant form of transportation.”

Rethinking the renewable industry

Washington companies that install solar panels at homes and businesses are among those that may soon be forced to reconsider their business model, which has been built in part on the government subsidizing the cost.

“I do not know if we’ll be able to survive unless we completely change what we do,” said Will Sumner, CEO and co-owner of Puget Sound Solar. He suggested his solar-only company will have to move into broader electrical work. “And that just is heartbreaking.”

Virtually all of the company’s residential solar installations have been on the back of a federal tax credit that is now set to sunset by the end of the year.

The credits have been in place for years but the Inflation Reduction Act, passed in former President Joe Biden’s term, had extended the credits into the next decade giving installers a runway for their eventual phaseout.

The credit has covered 30% of the system cost. When it goes away, estimates suggest it could shrink the residential market in Washington by 50% to 60%, Sumner said.

Sumner said they will be able to survive without the subsidies but solar companies need an offramp. Instead, Sumner said, the rug is being jerked out from under them.

Utility-scale renewable projects

The state is already behind schedule for requirements set by the Clean Energy Transformation Act of 2019 to free its electrical grid of greenhouse gas emissions by 2045, said state Commerce Director Joe Nguyễn. The federal legislation throws another substantial roadblock in the way.

State leaders acknowledged pulling back support for renewable energy projects like wind and solar farms could make it even harder to meet these requirements. Though Ecology Director Casey Sixkiller believes as long as the state continues to lower the barriers to getting projects sited and built, it will continue to attract these energy investments.

Due to changes in tax credits, Energy Innovation’s analysis estimated the legislation will decrease electricity capacity in Washington by 18 gigawatts by 2035 with solar and battery storage making up around 8 and 6 gigawatts respectively.

A past analysis from a Seattle-based nonprofit found the state will need 22 gigawatts of renewable energy by 2035 to replace electricity generated by coal and methane gas.

Material from The Associated Press was included in this story. Seattle Times data journalist Manuel Villa contributed reporting.