Trump says his policies will lead to “energy dominance.” Experts say electricity is going to get more expensive.

On the campaign trail last year, President Donald Trump told Americans that surging energy costs — the result of a “war on American energy” waged by his predecessor — would be stopped and prices would be cut in half when he took office. Electricity, heating, gasoline, air conditioning — everything would become more affordable when his energy dominance agenda took root, never mind that US oil drilling was already at record highs before the election. 

Experts have a much different analysis of the Trump administration’s large-scale shifts in energy policy, which include a renewed focus on fossil fuels and nuclear power, a curtailing of long-standing energy efficiency standards, and a scaling back of incentives seeking to speed up the switch to renewables. 

“When you push a series of policies that make it harder to add low-cost electricity to the power grid, that can be a gut punch to consumers that threatens to increase prices,” said Jim Chilsen, communications director for the Citizens Utility Board, an Illinois-based consumer advocacy group.

An analysis of the One Big Beautiful Bill Act’s energy provisions by Energy Innovation, a nonpartisan energy and climate think tank, predicts power generation capacity will actually fall by 340 gigawatts nationally by 2035, with consumers paying up to 18% more for electricity over the next decade. That’ll add up to $980 billion in lost GDP, an extra $170 a year in energy bills for every household, and 760,000 jobs lost through 2035 — mostly in clean energy, construction, and manufacturing. Sectors like steel and glass will be hit by declining solar installations.

White House statements and predictions about the bill offer a different narrative: it will lower energy prices, Vice President JD Vance said, increase oil drilling and timber harvesting, bolster the oil and gas industry, and create jobs. The business-friendly Tax Foundation estimates the bill will overall create 938,000 jobs over the next decade, though it doesn’t break it down by sector.

US energy demand stayed flat between 2005 and 2020, said David Carter, a director at the consultancy RSM, but it has been growing about 2% to 3% annually in recent years, spurred in part by burgeoning demand for AI data centers. That growth has risen to 8% a year in fast-growing spots like Texas. Filling that gap has led US utilities to direct substantial sums toward upgrading infrastructure: the Edison Electric Institute found that investor-owned utilities spent a record $178.2 billion last year on grid and power upgrades, and are on pace to spend $1.1 trillion between 2025 and 2029 to meet growing demand. These costs are being passed down to consumers already in the form of rising prices.

“We are at a critical point right now where we need to get all of the power on the grid as quickly as we can,” Carter said. 

Cutting off wind and solar by exacerbating permitting challenges, cutting federal incentives, and revoking federal leases won’t help the US meet the moment. 

This will hit consumers — already suffering from higher prices — pretty hard. The Rhodium Group predicts the average household will pay between $78 and $192 more annually. It’ll be a much bigger challenge for lower-income consumers who don’t have as much disposable income and can’t afford higher monthly utility bills. Carter expects it to influence these consumers’ buying patterns. 

Take a low-income renter, for example. In addition to likely higher energy costs, the administration wants to cancel the Low Income Home Energy Assistance Program, or LIHEAP, which provides emergency heating and cooling assistance to 6.7 million households, as well as rescind recent appliance energy efficiency updates and wind down Energy Star, a program that has saved consumers over $500 billion since inception through more efficient appliances. All of this makes it more likely that apartment dwellers will pay more for energy over time.

“There’s a debilitating impact skyrocketing utility bills can have on a family,” Chilsen said. “When you’re pouring all of your money into higher and higher utility bills, you have less money to pay for necessities like food, rent, and medicine, but also less money to help spark the economy.”

Prices have already been rising. The US Energy Information Administration says residential power bills in May, the latest data available, were 6.5% higher than a year earlier.

The US economy is seeing spiking energy demand from a number of sources that predate Trump’s second term, RSM’s Carter said — especially data center growth, reindustrialization, electrification and EVs, and manufacturing facility construction. But policies that make it harder to meet this energy need are coming at the worst time and will have a drag effect on the economy in the near term.

Part of the problem, according to Dan O’Brien, a senior modeling analyst at Energy Innovation, is that cutting renewable uptake means more dependence on natural gas plants and therefore higher natural gas costs. Solar plants and wind farms can come online in a year or two, whereas natural gas plants take years longer — especially with a current five-year backlog on ordering new turbines.

The Energy Information Administration is forecasting that electricity prices for industrial energy will be up by 3.4% this year, and the Energy Innovation report predicts wholesale energy costs will jump 74% by 2035. This shift (and the policies that exacerbated it) will be inflationary, O’Brien said, since so many industries — chemical manufacturing, pharmaceuticals, papermaking, and steel and aluminum manufacturing — are energy intensive. He called the rise in consumer costs and prices for goods a “double whammy.”

“Increased electricity prices are making their way down to consumers,” Carter said. “Manufacturers are themselves seeing increased prices from a number of factors right now, and it’s at a time when margins are tight, and so they just can’t absorb those increases.”

Curtailing renewables — McKinsey predicts that tariffs alone will cut US solar installations by 9% over the next decade — makes it harder to add the cheapest, most quickly deployed power options to the grid when they’re needed the most. Big Tech firms have been exploring other options for powering the insatiable demand of data centers; Alphabet has even made deals with geothermal startup Fervo to power facilities in Nevada. 

Carter doesn’t see Trump energy policies hampering data center growth as much as pushing companies to be more strategic and creative when it comes to planning, building, and powering them. O’Brien argues that as prices for electricity — the largest operating expense for data centers — continue to rise, it’ll slowly push tech companies to consider building more centers outside the US, which could eventually impede the industry’s domestic growth.

Some energy experts “are expecting greater siting of data centers in Europe and China, and essentially anywhere that there is continued investment in renewables, that will keep prices down on the grid,” O’Brien added.

“You definitely see the US stepping back from being a manufacturer and exporter of clean energy products and instead subsidizing these fuels of the past, like coal and gas and oil,” he said. “It’s trying to squeeze what we can out of that, instead of looking forward to where the world is going.”