Renewables Are Not Driving Up Electricity Prices

Donald Trump claimed recently that renewable energy is to blame for rising electricity prices. The evidence says otherwise. Retail bills are going up, but the reasons have nothing to do with clean energy. In fact, renewables are one of the strongest tools we have to keep costs in check.

What the Data Shows

Electricity from renewables is now cheaper than from fossil fuels. The latest federal data shows onshore wind averages about $50 per megawatt-hour, and solar about $60. By comparison, coal averages $118 and gas peaker plants $169. In 2024, more than 90 percent of new renewable projects came in below the cheapest fossil alternative.

States that lean heavily on renewables also show lower retail prices. Iowa, with 62 percent renewable generation, averages under 10 cents per kilowatt-hour. Kansas, Oklahoma, and North Dakota tell a similar story. By contrast, Hawaii, Massachusetts, and California pay over 20 cents. The drivers are clear. High-cost states struggle with geography, aging infrastructure, or climate-related spending, not with renewable penetration.

The Real Drivers of Rising Bills

Five forces are behind the recent price increases. None of them involves renewables:

1. Exploding demand from AI and data centers. By 2028, data centers could consume 12 percent of U.S. electricity, with AI workloads driving usage up to 30 times higher than standard applications.
2. Aging infrastructure. Most of today’s transmission grid was built in the 1960s and 70s. Replacement and expansion costs are doubling.
3. Natural gas volatility. With 40 percent of U.S. electricity being gas-fired, price swings in global gas markets flow straight to retail bills.
4. Grid congestion. Transmission bottlenecks forced $20 billion in congestion costs in 2022 alone.
5. Climate resilience. California has spent $27 billion in five years hardening its grid against wildfires. Other states are beginning to follow.

These structural pressures explain why bills are rising. Renewables, if anything, are a moderating influence.

Why Renewables Help

Wind and solar have two advantages that fossil fuels lack. They are immune to fuel-price volatility, and they follow a learning curve that keeps driving costs down. Every doubling of installed capacity reduces costs by another 20 percent. Coal and gas do not have that trajectory.

By expanding renewables, states shield consumers from global commodity shocks and stabilize wholesale prices. Restricting renewables does the opposite. Federal modeling shows that limiting clean energy build-out would raise wholesale prices 25 percent by 2030, adding hundreds of dollars per year to the average family’s bill.

The Policy Imperative

Rising bills are real. Families and businesses are feeling them. But blaming renewables distracts from the true sources of cost pressure and risks making the problem worse. The right policy response is to accelerate grid modernization and expand renewables, not to retreat from them. States that hold back on clean energy adoption will face higher costs, greater price volatility, and continued dependence on global fossil fuel markets.