Bipartisan Resistance to ‘Green’ Electricity Cuts Could Zap July 4 Budget Goal

Key Republicans say renewables are emerging as economic drivers in their states while a growing body of studies say sweeping slashes will hike energy costs.

Transmission lines at dusk. Andrey Metelev/ Unsplash

Like its House counterpart, the Senate’s draft version of President Donald Trump’s fiscal 2026 budget rescinds billions in approved funding for solar, wind, hydrogen, and carbon capture initiatives authorized under 2022’s Inflation Reduction Act (IRA) and 2021’s Infrastructure Investment and Jobs Act (IIJA).

Both chambers’ spending plans largely replicate the president’s One Big Beautiful Bill by slashing allocations for “green energy” before 2032 expirations, with the Senate iteration extending some tax credits and loan support to 2028, two years longer than the House’s immediate terminations.

During the Senate Energy and Natural Resources Committee’s June 18 hearing on the $46.3 billion budget request by the Department of Energy (DOE), Energy Secretary Chris Wright said a proposed 7 percent dip in his department’s annual spending—including a 26 percent gash in nondefense appropriations—is savings gleaned from consolidations and a streamlined refocus.

“This will enable DOE to return to its core mission of supporting projects most critical to America’s energy security while maintaining responsible stewardship of taxpayer dollars, something DOE failed to do in the previous administration,” he said.

The streamlining to which he was referring includes budget cuts across the department’s two dozen-plus program offices, 17 national labs, and 83 field installations, along with enacted or proposed trims in its 14,300-person workforce and 94,000 contractors.

Wright said that since he took office, DOE has “begun slashing more than 47 regulations as part of the largest deregulatory effort in history” that will save “the American people approximately $11 billion.”

That’s in addition to $3.7 billion in clawbacks of funding for 24 projects authorized under the IRA and IIJA that a newly created review team discontinued in May—the first round in examining the fiscal viability of 500 projects set to receive $300 billion through 2032.

The IRA rolls out 10 years of tax credits, low-interest loans, and grant programs that, by some estimates, could top $1 trillion to subsidize renewable energy generation, supply chains, job creation, advanced manufacturing, and electric grid expansion.

With a streamlined DOE focus, annual budget cuts, and rescissions in downstream commitments through 2032 incorporated into the overall plan, Senate Finance Committee Chair Sen. Mike Crapo (R-Idaho) said the Senate’s draft version of the president’s budget “prevents an over-$4 trillion tax hike” in coming years in across-the-board federal spending.

Senate Energy and Natural Resources Committee Chair Sen. Mike Lee (R-Utah), during the June 18 hearing, commended Wright “for taking strong action to protect taxpayers’ dollars, including by canceling nearly $4 billion in funding for worthless IRA projects.”

Sen. John Barrasso (R-Wyo.) added: “Congress irresponsibly saddled you with a department with 71 new programs overseeing hundreds of billions of taxpayer dollars. I think that the situation is fraught with waste, fraud, and abuse, and it left the department, your department now, without a clear direction.”

But the odds appear to be slim that Wright’s spending request and Trump’s overall proposed FY26 budget survive intact.

While Democrats fiercely contested across-the-board “green energy” cuts, Republicans in the 53–47 GOP-led chamber also raised objections, citing concerns about national lab staffing and funding slashes and lobbying to restore or approve projects in their states.

The Senate is under pressure to kick the plan back to the House, where Republicans hold a slim 220–212 majority and Speaker Rep. Mike Johnson (R-La.) aims to get a bill onto the president’s desk by July 4.

Such a tight timeline in narrowly divided chambers won’t likely be achieved without concessions—especially in energy development and funding.

A house with rooftop solar panels in Deerpark, N.Y. Yvonne Marcotte/The Epoch Times

Intermittent Debate

Lee said “wind and solar have been shown in many instances to have a negative effect” on energy costs “because generation like gas, nuclear, coal, among others, are forced to reduce output while still having fixed operational costs ... all to accommodate for electrons put onto the grid by other sources—intermittent renewable generation sources.”

Sen. Martin Heinrich (D-N.M.) disagreed, saying that an electron in transmission is not intermittent and that when consumers unplug from the grid—even if only for a few hours—to generate their own power, it ultimately trims utility fuel costs and electric bills.

Americans pay on average 17 cents per kilowatt hour, he said, but consumers in his New Mexico utility area, which is powered by 35 percent solar, 23 percent natural gas, 15 percent wind, 15 percent battery storage, and 5 percent coal, pay 10.8 cents per kilowatt hour.

“Today, with a little bit of storage, [utilities] manage the grid with low cost and reliability with renewables,” he said.

Meanwhile, Heinrich accused the Trump administration of crippling the nation’s solar and wind industries, saying that it’s pushing coal as its preferred baseload energy.

Citing a June report by Energy Innovation, a San Francisco-based energy policy and technology lab, he said the “average megawatt of power generated by U.S. coal plants is 28 percent more expensive in 2024 compared with 2021, and that means families spent $6.2 billion more on electricity generated by coal in 2024 than they would have just three years ago.”

Sen. John Hickenlooper (D-Colo.) asked Wright why DOE’s budget eliminates weatherization assistance programs that, he said, save households an average of $372 a year.

The “cheapest energy,” he said, is “energy we didn’t have to use.”

“You’re right, senator, energy efficiency is a huge opportunity, and of course, it’s pursued in different ways,” Wright said. “But I think the biggest drivers of efficiencies, like most things, has been market forces, right?”

“If we just keep regulating—you can only buy this super-efficient Cadillac. Well, other people can’t afford the Cadillac,” he said. “So different people evaluate trade-offs differently. So I’m always skeptical of fitting a one-size-fits-all answer onto our whole population.”

Lee said tax incentives for “intermittent sources” increase costs “of firm resources, thereby increasing costs for consumers at the end of the day,” noting he’s sponsoring a “bill that would repeal all the IRA subsidies for inferior generation, like wind and solar.”

But that bill, like the proposed wholesale slashes in “green energy” development in the president’s budget, faces bipartisan opposition—including among Lee’s Utah constituents.

Wind turbines operate near Whitewater, Calif., in February 2023. Mario Tama/Getty Images

GOP Green Support

According to Energy Innovation, more than $3 billion in clean energy development is underway in Utah, with $10 billion in planned projects potentially nixed if IRA allocations are rescinded.

That’s why Utah’s Sen. John Curtis was among four Republican senators who sent an April letter to Majority Leader Sen. John Thune (R-S.D.) to “caution against the full-scale repeal of current credits, which could lead to significant disruptions for the American people and weaken [the United States’] position as a global energy leader.”

“Many American companies have made substantial investments in domestic energy production and infrastructure based on the current energy tax framework,” Curtis and Sens. Lisa Murkowski (R-Alaska), Thom Tillis (R-N.C.), and Jerry Moran (R-Kansas) wrote.

Elected to the chamber in 2024, Curtis served four terms in the House, where he founded and chaired the chamber’s 82-member House Conservative Climate Change Caucus.

Many of its members were among the 21 GOP congressional reps who wrote a March letter to House Ways and Means Committee Chair Jason Smith (R-Mo.) lobbying to retain some IRA programs.

“Many credits were enacted over the course of a 10-year period, which allowed energy developers to plan with these tax incentives in mind,” they wrote.

“These timelines have been relied upon when it comes to capital allocation, planning, and project commitments, all of which would be jeopardized by premature credit phase-outs or additional restrictive mechanisms.”

The IRA has generated $132 billion in announced renewable energy projects nationwide, clean energy business group E2 documented in May, with two-thirds to 75 percent of those commitments in Republican congressional districts, primarily in North Carolina, South Carolina, Georgia, Michigan, and Texas.

The Solar Energy Industries Association, a trade group representing solar installers and small manufacturers, estimated in a May 12 statement that 75 percent of the “affected credits and spending cuts” would hit economies in Republican districts.

“At a time when billions of dollars are being invested in states that overwhelmingly voted for President Trump, this proposed legislation will effectively dismantle the most successful industrial on-shoring effort in U.S. history,” the group said.

Meanwhile, many analyses warn that the proposed IRA cuts are penny-wise but pound-foolish, and if enacted as written, will cost jobs, derail momentum in reshoring manufacturing, and raise electricity costs for millions of Americans.

They include Princeton University’s May ZERO Lab study, which determined that “repeal of current federal energy and climate policies” would raise household energy costs by $100–$160 a year by 2030 and by $270–$415 by 2035.

Rhodium Group’s May analysis said the House spending plan “will raise energy costs for American households by as much as 7 percent in 2035, stifle energy technology innovation, [and] increase pollution“ and could put ”a meaningful portion of $500 billion of new manufacturing, industrial, and clean electricity investments across the country” at risk.

A February NERA study for the Clean Energy Buyers Association said eliminating IRA “technology-neutral tax incentives for incremental electricity”—solar and wind that supplements, doesn’t supplant, baseload generation—would raise power costs from 6.7 percent to 9.7 percent between 2026 and 2029.

Resources for the Future, an independent research institution in Washington, said in a March analysis that IRA cuts would “increase nationally averaged electricity rates by roughly 5–7 percent” by 2030, “reaching a peak of 6-10 percent higher in 2035.”

These spikes would “translate into a $75–$100 increase in national average annual electricity bills in 2030, with a peak increase of $100–$150 per year” with “the highest impact seen in the upper plains states,” as much as $300–$400 per year, it states.