Report on the Impact of U.S. Clean Energy Policy Changes on Sustainable Development Goals

Executive Summary

Recent legislative changes in the United States, specifically the rollback of tax credits for renewable energy, are projected to have significant adverse effects on the achievement of several Sustainable Development Goals (SDGs). An analysis of the “One Big Beautiful Bill” indicates a forthcoming slowdown in the development of solar and wind energy, particularly in leading states like Texas. This policy shift is expected to impede progress on affordable and clean energy (SDG 7), decent work and economic growth (SDG 8), resilient infrastructure (SDG 9), and climate action (SDG 13), while also impacting the sustainability of communities (SDG 11).

Impact on SDG 7: Affordable and Clean Energy

The new policy framework directly threatens the core tenets of SDG 7 by making clean energy less accessible and affordable.

1. Reduced Deployment of Clean Energy: Projections from the research group Energy Innovation Policy and Technology estimate that by 2035, Texas alone will see a reduction of 54 gigawatts of solar and 23 gigawatts of wind development that would have otherwise occurred.
2. Increased Energy Costs: With fewer renewable projects being financially viable, increased reliance on natural gas is expected to drive electricity prices higher. A Princeton analysis predicts that electricity bills in Texas could rise by 5% by 2035 as a direct result of the policy changes.
3. Financial Disincentives: The law shortens the eligibility period for critical investment and production tax credits, ending them in 2027. The Congressional Budget Office estimates a utility-scale solar project will cost $126 million more to build in 2027 without the credits, severely undermining the financial case for new clean energy infrastructure.

Implications for SDG 8: Decent Work and Economic Growth

The curtailment of the clean energy boom poses a direct risk to economic growth and the creation of decent jobs, a central objective of SDG 8.

• Jeopardized Job Creation: Over 650 planned clean energy facilities in Texas, expected to create nearly 132,000 jobs, are now at risk. Advocates worry that tens of thousands of these planned jobs may be eliminated as project economics falter.
• Loss of Investment: Since the passage of the Inflation Reduction Act (IRA), companies had invested over $62 billion in Texas and announced plans for an additional $128 billion. Much of this planned capital investment is now at risk of not materializing.
• Slower Economic Growth: Economists, including Robert Stavins of Harvard University, have stated that the slowdown in renewable development will negatively impact state economic growth and pressure grid reliability.

Consequences for SDG 9 (Infrastructure) and SDG 11 (Sustainable Communities)

The policy changes will affect the development of resilient infrastructure and the sustainability of communities by straining the energy grid and increasing living costs.

• Threats to Grid Resilience: The Electric Reliability Council of Texas (ERCOT) projects a massive increase in electricity demand, from 86,000 megawatts in 2025 to 145,000 megawatts in 2031. A less diverse generation portfolio, with diminished contributions from solar and wind, compromises the grid’s resilience and its ability to meet this surging demand, directly impacting the reliability of infrastructure under SDG 9.
• Halted Infrastructure Projects: A significant increase in the cancellation of solar and battery storage projects was observed in the months preceding the policy change, representing a direct halt in the construction of modern, sustainable infrastructure.
• Impact on Sustainable Communities: Rising electricity costs will place a greater financial burden on households, particularly low-income consumers, undermining the goal of creating inclusive and sustainable communities (SDG 11).

Setbacks for SDG 13: Climate Action

The rollback of clean energy incentives represents a significant setback for national and global climate action targets.

1. Increased Greenhouse Gas Emissions: A reduction in new solar and wind capacity will necessitate greater reliance on fossil fuel-powered generation to meet demand. This will lead to an increase in greenhouse gas emissions, directly contradicting the objectives of SDG 13.
2. Reversal of Climate Policy: The new law effectively dismantles key components of the IRA, a landmark climate law designed to lower emissions and accelerate the energy transition.
3. Administrative Obstacles: The administration is reportedly creating additional permitting bottlenecks for renewable projects, further slowing the development of clean energy and hindering progress toward climate goals.

Concluding Analysis and Future Outlook

While the long-term cost reductions in solar and battery technologies may ensure their continued deployment, the pace will be significantly slower and the cost to consumers higher. The policy changes create an environment of uncertainty that discourages investment and undermines the stability required to achieve the Sustainable Development Goals.

• A short-term rush to commence projects before the 2026/2027 deadlines is anticipated, particularly in states like Texas with faster permitting processes.
• Despite inherent advantages, Texas’s growth in wind, solar, and battery storage will be hampered, impacting its ability to meet future energy needs affordably and sustainably.
• Ultimately, the legislative shift prioritizes short-term federal spending cuts over long-term investment in a sustainable, resilient, and clean energy future, placing key SDG targets further out of reach.

Analysis of Sustainable Development Goals in the Article

1. Which SDGs are addressed or connected to the issues highlighted in the article?

The article discusses the rollback of tax credits for clean energy in Texas, touching upon several interconnected issues that align with the following Sustainable Development Goals (SDGs):

• SDG 7: Affordable and Clean Energy: The core of the article is about the development of solar and wind power, the impact of government subsidies on their financial viability, and the resulting effect on electricity prices and grid reliability.
• SDG 8: Decent Work and Economic Growth: The text repeatedly highlights the economic consequences of the policy changes, including impacts on job creation, investment, and overall state economic growth.
• SDG 9: Industry, Innovation, and Infrastructure: The article covers the development of clean energy infrastructure, such as solar farms, wind turbines, and battery storage facilities, as well as the manufacturing of clean energy products. It discusses how policy uncertainty affects investment in this innovative and sustainable infrastructure.
• SDG 13: Climate Action: The article explicitly states that a primary goal of the original tax credits was to lower greenhouse gas emissions and that the new policy will likely cause them to increase, directly linking the discussion to national climate action strategies.

2. What specific targets under those SDGs can be identified based on the article’s content?

Based on the issues discussed, several specific SDG targets can be identified:

1. Target 7.2: By 2030, increase substantially the share of renewable energy in the global energy mix.
   • Explanation: The article is centered on the growth and potential slowdown of solar and wind power in Texas. It notes that Texas has built “more wind power than any state and is a top contender for the most solar power.” The policy changes are projected to result in “54 fewer gigawatts of solar developed and 23 fewer gigawatts of wind developed” by 2035, directly impacting the share of renewable energy.
2. Target 7.a: By 2030, enhance international cooperation to facilitate access to clean energy research and technology… and promote investment in energy infrastructure and clean energy technology.
   • Explanation: The article details how federal tax credits (a form of promoting investment) spurred massive financial commitments. It states, “Companies have invested over $62 billion in clean energy projects across the state since the passage of the IRA,” and that “over $128 billion in planned investment” is now at risk due to the rollback of these incentives.
3. Target 8.2: Achieve higher levels of economic productivity through diversification, technological upgrading and innovation…
   • Explanation: The development of the clean energy sector represents economic diversification and technological upgrading for Texas. The article warns that the policy change could lead to “slower state economic growth” and jeopardize “tens of thousands of planned jobs,” which would have contributed to higher economic productivity.
4. Target 9.4: By 2030, upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies…
   • Explanation: The article discusses the buildout of sustainable infrastructure, including “utility-scale solar farms,” “wind farms,” and “battery projects.” The cancellation of these projects (“roughly 4 gigawatts of battery projects and 3.5 gigawatts of solar projects were canceled”) represents a direct setback to upgrading the state’s energy infrastructure to be more sustainable and clean.
5. Target 13.2: Integrate climate change measures into national policies, strategies and planning.
   • Explanation: The article analyzes the direct impact of national legislation on climate goals. The Inflation Reduction Act (IRA) is described as a “landmark climate law” intended to “lower greenhouse gas emissions.” The new “One Big Beautiful Bill” reverses this policy, leading to a prediction that “greenhouse gas emissions will increase,” demonstrating a shift in the integration of climate measures in national policy.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

Yes, the article provides several quantitative and qualitative indicators that can be used to measure progress:

• Renewable energy capacity (in gigawatts): The article uses gigawatts (GW) to measure the scale of renewable energy development and cancellations. For example, it mentions the projection of “54 fewer gigawatts of solar developed and 23 fewer gigawatts of wind,” and the cancellation of “roughly 4 gigawatts of battery projects and 3.5 gigawatts of solar projects.” This is a direct indicator for Target 7.2.
• Financial investment (in dollars): The text quantifies the investment flowing into the clean energy sector. It cites that “Companies have invested over $62 billion” and announced “over $128 billion in planned investment.” This serves as an indicator for Targets 7.a and 9.4.
• Number of jobs: The impact on employment is a key indicator mentioned. The article states that the announced facilities were “expected to create close to 132,000 jobs” and that “tens of thousands of planned jobs might get killed.” This is a clear indicator for Target 8.2.
• Greenhouse gas emissions levels: Although no specific numbers are given, the article explicitly refers to the direction of change in emissions as an outcome of policy. It notes the original goal was to “lower greenhouse gas emissions” and a Princeton analysis predicted that with the new policy, “greenhouse gas emissions will increase.” This is a primary indicator for Target 13.2.
• Electricity prices: The article mentions the effect on consumer costs, stating that “electricity bills in Texas will rise by 5% by 2035.” This can be seen as an indicator of progress towards affordable energy under SDG 7.

4. Table of SDGs, Targets, and Indicators

Source: texastribune.org