As HouseRepublicanspropose taking a sledgehammer to the green tax credits in Joe Biden’s Inflation Reduction Act, new data shows the loss of those incentives could lower some Americans’ household income by more than $1,000 a year due to increased utility bills and job losses.
ThoughDonald Trumphas called climate spendinga “waste” of money, the data –published by the industry group Clean Energy Buyers Association(Ceba) on Thursday – provides evidence that rescinding them would actually increase expenses for ordinary Americans in red and blue districts alike.
The rollback would increase the price of electricity and gas, the report found. And it would lead to job losses and “economic slowdown”, it says.
“Americans voted to combat the cost-of-living crisis in the 2024 election,” said Rich Powell, CEO of Ceba. “Now is the time for Congress to incentivize private investment in more sources of low-cost, reliable energy that fuels economic growth and jobs, helps the United States secure energy dominance and independence, and decreases energy costs nationwide.”
The new figures, crunched for Ceba by the National Economic Research Associates consulting firm, focus specifically on credits 48E and 45Y, for clean energy investment and production respectively. In a reconciliation package draft this week, the House ways and means committee proposed phasing out these incentives after 2031, and placing many new restrictions on them in the meantime.
If the rollbacks proceed as proposed, the new study found, at least 19 states would see the cost of energy increase for both consumers and industry between 2026 to 2032. (More states would likely see similar impacts, but the authors did not examine all 50 “because of the turnaround time for research”, Ceba said).
New Jersey is the state expected to see the biggest economic losses if the clean energy investment and production credits are repealed, the authors found. There, the authors found the rollback could increase household gas and utility bills by 2.9% and 13.3% respectively. The repeal would also trigger the loss of 22,180 jobs, they found.
All told, households across the state would see a stunning $1,040 average loss in annual household income and a $3.24bn decrease in state GDP, the authors wrote.
“As commercial and industrial activity declines, demand for labor and capital falls, leading to wage losses, declining household income, and shrinking investment,” the research says.
The authors’ outlooks for state-level electricity markets assumes an incremental growth in electricity demand due to the growth of data centers. Some of Ceba’s members are tech giants – including Amazon, Google and Meta – who are bringing moredata centersonline.
Anearlier Ceba report, published in February, forecasted the effect on electricity prices alone across all 50 states. If the clean energy investment and production credits are repealed, the average American household would see their annual household utility bills increase by $110 by 2026, it found.
Wyoming would see the largest rise of 29.5% on average for households across the state, the earlier report found.