Solar executives say Trump attack on renewables will lead to power crunch

President Donald Trump‘s attack on solar and wind projects threatens to raise energy prices for consumers and undermine a stretched electric grid that’s already straining to meet rapidly growing demand, renewable energy executives warn.

Trump has long said wind power turbines are unattractive and endanger birds, and that solar installations take up too much land. This week, he said his administration will not approve solar and wind projects, the latest salvo in a campaign the president has waged against the renewable energy industry since taking office.

“We will not approve wind or farmer destroying Solar,” Trump posted on Truth Social Wednesday. “The days of stupidity are over in the USA!!!”

Trump’s statement this week seemed to confirm industry fears that the Interior Department will block federal permits for solar and wind projects. Interior Secretary Doug Burgum took control of all permit approvals last month in a move that the American Clean Power Association criticized as “obstruction,” calling it “unprecedented political review.”

The Interior Department blocking permits would slow the growth of the entire solar and wind industry, top executives at renewable developers Arevon, Avantus and Engie North America told CNBC.

Even solar and wind projects on private land may need approvals from the U.S. Fish and Wildlife Service if, for example, a waterway or animal species is affected, the executives told CNBC. The three power companies are among the top 10 renewable developers in the U.S., according to energy research firm Enverus.

The Interior Department “will not give preferential treatment to massive, unreliable projects that make no sense for the American people or that risk harming communities or the environment,” a spokesperson told CNBC when asked if new permits would be issued for solar and wind construction.

Choking off renewables will worsen a looming power supply shortage, harm the electric grid and lead to higher electricity prices for consumers, said Kevin Smith, CEO of Arevon, a solar and battery storage developer headquartered in Scottsdale, Arizona, that’s active in 17 states. Arevon operates five gigawatts of power equivalent to $10 billion of capital investment.

“I don’t think everybody realizes how big the crunch is going to be,” Smith said. “We’re making that crunch more and more difficult with these policy changes.”

Uncertainty hits investment

The red tape at the Interior Department and rising costs from Trump’s copper and steel tariffs have created market instability that makes planning difficult, the renewable executives said.

“We don’t want to sign contracts until we know what the playing field is,” said Cliff Graham, CEO of Avantus, a solar and battery storage developer headquartered in San Diego. Avantus has built three gigawatts of solar and storage across the desert Southwest.

“I can do whatever you want me to do and have a viable business, I just need the rules set and in place,” Graham said.

Engie North America, the U.S. arm of a global energy company based in Paris, is slashing its planned investment in the U.S. by 50% due to tariffs and regulatory uncertainty, said David Carroll, the chief renewables officer who leads the American subsidiary. Engie could cut its plans even more, he said.

Engie’s North American subsidiary, headquartered in Houston, will operate about 11 gigawatts of solar, battery storage and wind power by year end.

Multinationals like Engie have long viewed the U.S. as one of the most stable business environments in the world, Carroll said. But that assessment is changing in Engie’s boardroom and across the industry, he said.

“The stability of the U.S. business market is no longer really the gold standard,” Carroll said.

Rising costs

Arevon is seeing costs for solar and battery storage projects increase by as much as 30% due to the metal tariffs, said Smith, the CEO. Many renewable developers are renegotiating power prices with utilities to cover the sudden spike in costs because projects no longer pencil out financially, he said.

Trump’s One Big Beautiful Bill Act ends two key tax credits for solar and wind projects in late 2027, making conditions even more challenging. The investment tax credit supported new renewable construction and the production credit boosted clean electricity generation.

Those tax credits were just passed on to consumers, Smith said. Their termination and the rising costs from tariffs will mean higher utility bills for families and businesses, he said.

The price that Avantus charges for solar power has roughly doubled to $60 per megawatt-hour as interest rates and tariffs have increased over the years, said CEO Graham. Prices will surge again to around $100 per megawatt-hour when the tax credits are gone, he said.

“The small manufacturers, small companies and mom and pops will see their electric bills go up, and it’ll start pushing the small entrepreneurs out of the industry or out of the marketplace,” Graham said.

Renewable projects that start construction by next July, a year after the One Big Beautiful Act became law, will still qualify for the tax credits. Arevon, Avantus and Engie are moving forward with projects currently under construction, but the outlook is less certain for projects later in the decade.

The U.S. will see a big downturn in new renewable power generation starting in the second half of 2026 through 2028 as new projects no longer qualify for tax credits, said Smith, the head of Arevon.

“The small- and medium-sized players that can’t take the financial risk, some of them will disappear,” Smith said. “You’re going to see less projects built in the sector.”

Artificial intelligence power crunch

Fewer renewable power plants could increase the risk of brownouts or blackouts, Smith said. Electricity demand is surging from the data centers that technology companies are building to train artificial intelligence systems. PJM Interconnection, the largest electrical grid in the U.S. that coordinates wholesale electricity in 13 states and the District of Columbia, has warned of tight power supplies because too little new generation is coming online.

Renewables are the power source that can most quickly meet demand, Smith at Arevon said. More than 90% of the power waiting to connect to the grid is solar, battery storage or wind, according to data from Enverus.

“The power requirement is largely going to be coming from the new energy sector or not at all,” so without it, “the grid becomes substantially hampered,” Smith said.

Trump is prioritizing oil, gas and nuclear power as “the most effective and reliable tools to power our country,” White House spokesperson Anna Kelly said.

“President Trump serves the American people who voted to implement his America First energy agenda – not solar and wind executives who are sad that Biden’s Green New Scam subsidies are ending,” Kelly said.

But new natural gas plants won’t come online for another five years due to supply issues, new nuclear power is a decade away and no new coal plants are on the drawing board.

Utilities may have to turn away data centers at some point because there isn’t enough surplus power to run them, and no one wants to risk blackouts at hospitals, schools and homes, Arevon’s Smith said. This would pressure the U.S. in its race against China to master AI, a Trump administration priority.

“The panic in the data center, AI world is probably not going to set in for another 12 months or so, when they start realizing that they can’t get the power they need in some of these areas where they’re planning to build data centers,” Smith said.

“Then we’ll see what happens,” said the University of Chicago MBA, who’s worked in the energy industry for 35 years. “There may be a reversal in policy to try and build whatever we can and get power onto the grid.”