President Donald Trump’s budget could raise energy rates, further strain the energy grid and jeopardize New York’s goals to reduce emissions, experts and advocates say.
Trump’s budget proposal and the One Big Beautiful Bill Act would cut, by 2026, incentives for energy developers as experts believe demand could increase by 50% over the next 15 years.
Losing the incentives would likely slow the development of renewable energy developments like solar and wind farms — the type of developments that some advocates say could help build out the energy grid and reduce rates.
Consumers are already struggling to pay energy bills. More than one in every 10 households serviced by National Grid owes two or more billing cycles to the company, data from the Public Service Commission shows.
Rates are also scheduled to rise over the next three years based on a tentative price increase deal between National Grid and the state’s Public Service Commission, according to an Albany Times-Union article.
“We have a general affordability crisis,” said Public Power NY co-Chair Michael Paulson. “We need rapid action on our energy system to make it work for everyone so that we can have lower utility bills, so we can have clean air.”
The fallout from OBBB and Trump’s proposed budget could also threaten New York State’s Climate Leadership and Community Protection Act — the state’s greenhouse gas emissions reduction goals that experts say were already behind schedule.
The CLCPA set a number of ambitious goals, including to reduce emissions significantly below 1990 levels by 2030 and achieve 100% zero-emission electricity by 2040.
Eric Hittinger, the chair of the Department of Public Policy at the Rochester Institute of Technology, called New York’s climate plan the most ambitious in the country.
It will likely be hampered by OBBB because it rolls back incentives to boost renewable energy that were passed by Democrats during former President Joe Biden’s term.
That could have a cascading effect for consumers in addition to not mitigating the effects of climate change. Rates for energy are already increasing. Demand for energy is expected to increase. The OBBB could force states and energy companies back to fossil fuel energy at a time when experts believe the country should be moving away from it.
Renewable energy, experts argue, is cleaner, cheaper and could help fill the coming demand.
“The federal budget bill slashes the very tools states need to achieve energy independence and economic growth, and no state will be able to backfill the massive cuts they face,” said Ken Lovett, a Hochul spokesperson.
Why rates are high and how to lower them
Green energy advocates and energy generation experts say New York can help decrease energy bills by expanding clean renewable energy, a process that could take at least another decade.
Paulson and Ethan Gormley, a climate justice organizer with Citizen Action NY, say the state needs renewable energy to not only decrease costs, but to also keep pace with the timeline of its climate goals. This approach, they say, was more achievable prior to the passage of the OBBB.
“When it comes to public power, the state doesn’t have to make a massive profit in the way that private developers do,” said Paulson, the advocate from Public Power NY.
The state has laid out plans for several renewable developments owned by the public sector, but even those projects face an uncertain future after the passage of the OBBB, according to reporting from New York Focus.
The OBBB includes provisions that would limit how much developers can invest on parts coming from countries like China and Russia, which have been deemed by the federal government as “foreign entities of concern.”
Hart said this is a crushing tenet of the OBBB given that a bulk of parts for renewable developments come from China.
“A lot of people believe that this law is not really workable,” he said. “Companies may feel like they’re legally exposed if they’re operating under uncertainty.”
Renewables, Hart said, are some of the easiest and cheapest energy arrays to build.
“So taking that off the table is counterproductive if the goal is to expand energy production,” Hart said.
The state could also update the systems it uses to deliver electricity and make the process more efficient, leading to lower utility costs, Hittinger said.
The bulk of the nation’s existing energy infrastructure – wires, transformers, substations, and more – hasn’t received upgrades in decades, he said. Compared to most other aspects of modern life, the metering, control, and digitalization of the nation’s electricity system is remarkably antiquated, Hittinger said.
Despite the lack of investment in newer tech, New York has enjoyed lower energy rates for the past 40 years comparative to other parts of the world, Hittinger said.
“It looks like something out of the 1980s – mostly because it is something out of the 1980s,” Hittinger said.
Both sets of experts and advocates believe OBBB would also threaten one of Trump’s campaign promises: To halve Americans’ utility bills.
“Under my administration, we will be slashing energy and electricity prices by half within 12 months, at a maximum 18 months,” Trump promised at a 2024 rally in North Carolina.
The president also made clear his intent to bring wind and solar to heel, which he called a “blight to the country.”
For Gormley, Citizen Action NY’s climate justice organizer, the federal government has muddled the picture — especially for ratepayers.
“Right now, all I see are a lot of question marks,” Gormley said. “The last thing we want are those question marks when it comes to dollar signs for regular Central New Yorkers.”
800 hours of blackouts by 2030
Hart and Hittinger believe the expansion of artificial intelligence could cause energy rates to soar in New York.
Trump has said he wants to keep propelling advancements in AI. The president announced Monday his administration is set to invest $92 billion in AI and energy generation projects, some of which include nuclear energy.
Beyond added costs, households could also face more unreliable electric services. In early June, the U.S. Department of Energy warned Americans could see 800 hours — more than a month — of blackouts each year by 2030.
The nation currently averages just eight hours of blackouts each year.
Hittinger believes the 800-hour estimate is overblown.
“That’s the kind of projection that assumes that no one’s paying attention to increased demand, and no one will take any action to deal with it,” Hittinger said. “And neither of those assumptions are true.”
The expansion of automation and AI puts more pressure on New York and the federal government to find solutions to boost the energy grid’s capacity.
For Trump, that’s meant pushing investment in nuclear power, which advocates say will shift the weight onto ratepayers — already dealing with skyrocketing rates — to subsidize ensuing projects.
Hittinger thinks that if Trump’s concerns about rising rates are genuine — and the country and state want to boost its grid capacity — Trump should support New York’s investments in wind, solar and energy storage.
“Those are the cost effective technologies to meet the electricity demand of the future,” Hittinger said.
The Public Service Commission and New York State Energy Resource and Development Authority for decades have planned the state’s response to growing energy demands.
Those agencies have in the past considered how transitioning to electric vehicles and heat pumps would strain electric demand. Hittinger expects they can do the same to prepare for AI-related surges in the state’s energy appetite.
That transition, Hart and Hittinger said, might have to include a varied approach to energy generation.
The two experts said they want the state to eventually wean off of fossil fuels, but for now, the state should be more pragmatic. Embracing technologies like nuclear, alongside more green arrays, could help alleviate issues of growing demand, costs to consumers, and feasibility.
“It takes a long time to build any of these things, and so the transition is going to be a slow one. So I agree with the idea of all of the above,” Hart said. “But not forever.”
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