On July 4th, President Trump signed a significant bill, referred to as the "Big, Beautiful Bill" (or “BBB”), into law. This legislation aims to roll back expensive subsidies and ineffective regulatory policies that have supported a misguided energy transition from reliable and abundant hydrocarbons to costly, intermittent and underwhelming “clean” energy sources like wind and solar for far too long.
Although subsidies are meant to drive prices down and boost supply, those for wind and solar have done exactly the opposite.
The Renewable Electricity Production Tax Credit for wind energy was first introduced in 1992 and originally sold on a promise of offering low-cost energy and set to be phased out in 1999.
Since then, it has been extended a whopping 12 times, while consumers continue to pay more on average for their home electric bills than in 1992, even after adjusting for inflation.
The BBB law rapidly phases out tax credits for wind and solar systems and electric vehicles, while making it cheaper to drill and mine for fossil fuels on federal lands.
Obama administration economist Jason Furman stated in a recent New York Times op-ed that the Republican BBB “law repeals much of what Joe Biden did for climate change.”
He’s right, but Biden shouldn’t get all that credit.
For example, gone is a 50-year government automotive fuel economy regulation experiment that even the Department of Transportation has admitted offered no climate benefits yet forced carmakers to push out expensive EVs produced at financial losses that had limited public markets.
Ford, for example, reportedly lost about $44,000 on each SUV it sold in the second quarter of 2024.
Those heavily subsidized plug-in EVs are some of the slowest sellers on dealership lots, taking about twice as long to sell than gas-powered vehicles and even longer than increasingly popular gas-electric hybrids.
Also gone with BBB is a waiver that would let California and other states impose even more onerous requirements impacting the entire country.
While several energy subsidies such as EV tax credits granted in the so-called “Inflation Reduction Act” (IRA) of 2022 would end as early as Sept. 30, others including hydrogen, wind and solar, would need to be online by either Dec. 31, 2027, or Jan. 1, 2028, depending on the type of project, to retain their tax credits.
For hydrogen, this credit ends five years earlier than had been originally provided under the IRA.
Wind and solar projects placed in service after 2027 would not be eligible for the clean electricity production or investment credit unless construction starts within one year of the date of enactment of the legislation.
Meanwhile, consider that more than 75% of today’s U.S. electricity comes from natural gas, nuclear and coal — and they supply it 24/7, independent of the weather.
For reference, at 8 p.m. on bitterly cold Inauguration Day as much of the Eastern seaboard region reached peak demand for electricity, PJM Interconnection which supplies most of the Mid-Atlantic United States got approximately 44% of its power from coal, 24% from natural gas, 25% from nuclear, with only 3% available from wind and none from solar.
Increasing wind and solar power grids also decrease baseload reliability during times of maximum stress and demand.
Plus, you can never know if or when these energy sources will be able to produce electricity when you need it — because you don’t know if the skies will be cloudy or the winds won’t be blowing.
We can draw a lesson from a bad experience last March in Spain, when a sudden power outage collapsed their grid, disrupting lives and paralyzing activities of about 55 million people across the Iberian Peninsula.
The event is broadly attributed to excessive dependence on “renewables,” which account for 66% of Spain’s installed capacity — mostly wind, solar and hydro — and have generated about 60% of the country’s electricity.
Since the blackout occurred on a sunny day, and hydro doesn’t fluctuate with weather, any attribution leaves wind as the only likely contributing culprit.
Economies of wind and solar energy for utility operators and customers are no bargain either.
These intermittent sources force grid operators to maintain two separate systems — one for legacy power and another for renewable sources.
When wind and solar come online, legacy resources must be scaled back, and when they aren’t available at times of peak demand reliable baseload sources must scale up.
Since much of that baseload electricity typically comes from natural gas, it means that the turbines must inefficiently adjust up and down to keep grids balanced, like uneconomically driving a car in heavy traffic.
Unfortunately, most energy consumers are unaware that massive subsidies required to finance wind and solar extravagance come out of their pockets in two ways: through taxes and through higher electricity costs.
Also include additional expenses for pushing more electric vehicles on overburdened grids, thanks also to a combination of federal and state tax and purchase credits and regulations on more popular gasoline models.
It’s time to stop subsidizing such insanity in perpetuity and recognize that these policies have resulted only in driving energy prices up and grid stability down.
The Big Beautiful Bill offers a promising transition to sensibility.
Larry Bell is an endowed professor of space architecture at the University of Houston where he founded the Sasakawa International Center for Space Architecture and the graduate space architecture program. His latest of 12 books is "Architectures Beyond Boxes and Boundaries: My Life By Design" (2022). Read Larry Bell's Reports — More Here.
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