The Trump administration wants to squash clean energy. How bad will it be for California?

San Francisco Chronicle​

3 days ago

Before President Donald Trump was elected for the second time, catastrophic wildfires sent electricity prices soaring and posed one of the biggest continuing threats to energy affordability in California.
Today, there's another major factor. Since taking office, the Trump Administration has thrown up roadblocks for clean energy development at a time when electricity demand is rising. In nearly a dozen policy directives, the administration is ending subsidies and tax credits for wind and solar and adding regulatory hurdles that could slow new development.
These actions, some renewable energy advocates say, could drive up electricity prices even more nationwide and especially in California, a state pushing new large-scale wind and solar projects in its race to ensure homes and businesses are powered solely by clean energy sources by 2045.
'It's going to hurt affordability for literally every person in this country," said Merrian Borgeson, California climate and energy policy director with the Natural Resources Defense Council.
Trump has repeatedly complained that wind and solar farms are eyesores that take up too much space and are too reliant on government subsidies. His administration has quickly reversed policies promoting renewable energy, while clearing hurdles for gas- and coal-fired power sources.
'We will develop the liquid gold that is right under our feet, including American oil and natural gas,' Trump wrote on social media. 'And we will also embrace nuclear, clean coal, hydropower, which is fantastic, and every other form of affordable energy to get it done.'
However, Trump's view of renewables overlooks how much less expensive experts say they are to develop compared to gas and coal. A June report from Lazard asset management firm found that 'utility-scale solar and onshore wind remain the most cost-effective forms of new-build energy generation,' even with no government subsidies, and that the cost of building new gas turbines had reached a 10-year high.
'It costs less to build a new clean energy power plant than to just operate an existing fossil fuel plant,' said Daniel Kammen, a professor of energy at UC Berkeley.
The actual impacts of Trump's policies to utility bills, if any, aren't yet known because most have yet to be implemented. One of the most impactful changes may be the abrupt end of tax credits that can save clean energy developers at least 30% on costs. That tax credit was slated to begin phasing out in 2032, but the Trump administration has changed the deadline to Dec. 31, 2025.
The American Clean Power-California is urging state agencies to speed up approvals of projects currently under review so that they qualify for the federal tax credits before they sunset. Without the tax credits, developers could be paying between $400 million to $650 million more per gigawatt of large-scale solar or wind resources currently in the pipeline, according to an association memo submitted to the CPUC. That could boost costs by as much as 60% over the lifetime of a project, according to the association. These aren't direct costs to ratepayers but could eventually filter into utility bills.
Utilities pass the costs of buying energy directly to customers. For example, roughly 38% of Pacific Gas and Electric Co. residential bills go toward power the company generates and power it buys from power producers.
PG&E spokesperson Lynsey Paulo said that the company is currently not aware of any impacts to new power projects related to changes in federal policies. The company 'met our residential and small business customers' electricity use with 98% greenhouse-gas free electricity in 2024,' she said.
PG&E will continue adding greenhouse gas-free sources of electricity 'to reduce emissions across our energy system and make progress toward our goal of net-zero emissions by 2040 at the lowest possible cost,' she said.
Alex Jackson, executive director of the power association said there is now a race among developers to qualify for the subsidies and tax breaks before they expire. But he said the state has a lot of tools to push projects forward despite federal policies.
'California is a big state. It has a lot of influence,' Jackson said. 'It's not helpless in this fight.'
State regulators this summer fast-tracked a massive new solar project in Fresno County slated to include more than 3 million solar panels and the largest solar energy battery storage system in the world.
Called the Darden Clean Energy Project, it was the first project approved in a new process designed to reduce regulatory hurdles. The project developer, a subsidiary of San Francisco-based Intersect Power, didn't respond to a request for comment from the Chronicle. But Borgeson said that the project is unlikely to face federal pushback because it is on private land and primarily required state approval.
A California Public Utilities Commission spokesperson said there are 'hundreds' of clean energy projects currently in the pipeline.
'We are actively assessing how recent changes in federal tax, tariff, and land use policy may impact the long-term prospect for projects planning to come online to serve California – but so far 2025 has continued to see robust development of new resources,' said Terrie Prosper, CPUC spokesperson.
But it's not just heavily Democratic California that relies on clean energy sources. Wind is an important power source in states like Texas and Oklahoma, and solar power is critical in sunny states like Arizona and Nevada. In an Aug. 4 letter to Department of the Interior Secretary Doug Burgum, Nevada Gov. Joe Lombardo warned that new federal policies toward clean energy had already stalled important solar energy projects for the state and would harm his state's 'business-friendly environment.'
'Solar energy development on federal land fuels Nevada's economy,' he wrote.
Many energy experts are hopeful that California will continue using its economic clout to continue fueling the clean energy boom despite federal headwinds.
Gov. Gavin Newsom recently reported that the state brought a record amount of clean energy online in 2024 – about 7,000 megawatts – boasting in a news release that the state 'has never added so much capacity to our grid in such a short amount of time.' The state must triple the amount of clean energy to meet its 2045 goal – and solar is a significant part of that.
Bernadette Del Chiaro, senior vice president for California at the Environmental Working Group, criticized California for slashing incentives for rooftop solar at a time when energy demand is rising and the federal government is hostile.
'We can't place all the blame on Trump. Newsom has unwisely engaged in a zero sum game of pitting one form of renewable energy against another (rooftop vs utility scale),' Del Chiaro said.
With the many hurdles it is creating for large-scale projects, the federal government 'has a great deal of power to slow and delay clean energy projects, which results in higher costs,' Kammen said.
Even so, Kammen said he doesn't expect it to impact utility bills in part because electricity prices are influenced by many other factors including natural gas markets. Plus, momentum for new clean energy projects is strong because 'it costs less to build a new clean energy power plant than to just operate an existing fossil fuel plant,' he said.
'The clean energy transition has left the station,' Kammen said.