Dylan Scott reporting in for your pre-Fourth of July edition. I feel obliged to link to the hottest take Vox has ever published (and please direct your feedback to Dylan Matthews.) Oh, and a related programming note: We'll be off tomorrow! 🇺🇸 The Republican budget reconciliation bill has been the big news of the week. The plan is a Frankenstein of unrelated policies bolted together; I wrote about the consequences of the $1 trillion in Medicaid cuts after Senate Republicans passed the legislation on Tuesday. My colleague Umair Irfan honed in on another long-term impact of the Republican bill: The US is poised to fall behind China in the energy wars, an outcome that is sure to affect each of our lives and our wallets. Read on to learn more. |
|
|
Trump's plan to replace clean energy with fossil fuels has some major problems |
|
|
The first solar cell ever made was built in the United States. Tesla, based in the US, was once the largest EV manufacturer in the world. The lithium-ion battery was co-developed in the US. But today China, not the US, is the largest manufacturer of solar cells and batteries. China's BYD, not Tesla, is the largest EV manufacturer in the world. And China is starting to outrun the US on research and development investment. Now, President Trump's "big, beautiful bill," which just passed the Senate, would push the US further to the margins of a global clean energy revolution that it could have dominated. For years now, clean power has been the largest source of new electricity in the US. Solar, batteries, and wind are on track to make up more than 90 percent of new electricity capacity on the US power grid this year. Wind and solar now produce more electricity on the US power grid than coal. Almost twice as many Americans work in clean energy compared to fossil fuels, and the sector is still growing. But thanks to the bill, that may not be the case for much longer. The latest version rolls back many of the investments from the 2022 Inflation Reduction Act, the single-largest US investment to address climate change by giving the energy transition a boost. It calls for more rapid phaseouts of tax credits for wind and solar power and eliminates a $7,500 tax credit for the purchase of a new electric vehicle. It even creates a new tax credit for coal. These provisions are in line with Trump's longstanding antipathy toward renewable energy and disbelief in climate change. However, they stand to hobble the US economy more broadly. The US is facing significant load growth on the power grid for the first time in decades as the tech industry scrounges for electrons to power its electricity-devouring data centers. While renewables are cut, the alternatives are not likely to make up the gap in time. The US is currently the largest oil and gas producer in the world, but it can take years to site, permit, and acquire the materials to build power plants that burn these fuels.
Right now, oil prices are at four-year lows and natural gas prices are falling, and when prices are low, it's much harder to make the business case for more mining, drilling, and power plants, even with incentives. Trump can, for example, open up more federally managed lands for energy production, but many of those leases sit unused because energy companies don't want to create a supply glut. Meanwhile, employment in the oil and gas industry remains volatile, while coal jobs are continuing their decades-long decline.
|
The Senate bill does extend tax credits and loan programs for nuclear energy and geothermal power. However, the cuts in the bill would also slow efforts to build up the domestic energy supply chain needed to bolster other zero-emissions technologies, from raw materials like lithium and rare earth minerals to battery factories. It would do little to relax the bottlenecks for connecting new power plants to the grid that are adding years to project timelines. The US is also dismantling research and development that could yield the next energy breakthrough. On top of all this, Trump's tariffs are raising operating costs not just for renewables, but for the fossil fuels he loves so much. The net result is a policy suite that will not only hamper clean electricity, but energy overall, making it more expensive for everyone across the country. According to Energy Innovation, the Senate bill would increase household electricity prices on average by $130 per year, eroding almost a trillion dollars in economic productivity, and costing 760,000 jobs by 2030. While the US is putting clean energy in reverse, other countries are racing ahead. Clean energy technology investment is poised to increase to $2.2 trillion this year around the world. Renewables are on track to overtake coal as the biggest power source in the world this year. Wind, solar, and batteries are still getting cheaper. Effectively, the US is ceding one of the biggest growth industries in the world to China, particularly as developing countries industrialize and other wealthy countries look to decarbonize their economies. The case for more clean energy – lower costs, faster deployment, fewer greenhouse gas emissions – remains robust. Even with all the deliberate obstacles the Trump administration is placing ahead, there are some wind, solar, and battery projects still poised to come online in the US as they work their way through the pipeline, albeit at a much slower pace than before. But without continued investment, the US will lose ground to the rest of the world and condemn itself to dirtier, more expensive energy. |
|
|
⮕ Keep tabs SCOTUS review: While you were watching Trump, Vox's Ian Millhiser was watching the Supreme Court. He summed up this most recent term for the rest of us. Idaho murders case closed: With a guilty plea in the 2023 murders of four college students in Idaho, it's worth revisiting this essay from Vox's Aja Romano on why those horrific crimes captured the country's attention. Sleepless in America: The country is chronically tired, with huge ramifications for our mental and physical health, as well as our quality of life. [The Atlantic] Science of cool: A new study purports to identify the six factors that determine whether other people think you have "it" or not. [New York Times] |
|
|
| Make America Uninsured Again |
If the Senate's massive tax and immigration bill passes the House, it will be the biggest cut to Medicaid since the program began and could fracture the GOP's 2024 base. |
|
|
You may have seen the New York Times's 100 Best Movies of the Century feature already, but I'm here to tell you to take another look. Ignore the consensus list; who needs a consensus when it comes to art? Instead, I'd urge you to look through the individual ballots of filmmakers, actors, and critics who contributed their rankings to the list. You'll find some fascinating tastes and more than a few recommendations. |
|
|
Today's edition was produced and edited by me, senior correspondent Dylan Scott. For our American readers, enjoy the holiday tomorrow! For everybody else, have a great normal day. |
|
|
Are you enjoying the Today, Explained newsletter? Forward it to a friend; they can sign up here. And as always, we want to know what you think. Let us know by filling out this form or just replying to this email. |
|
|
|
