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Clean Energy Is Still the Cheapest Energy. States Must Deploy It, Fast.

The secret to lowering energy costs

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100% Clean Power

Thursday, July 31, 2025

Up close shot of a worker moving a solar panel during an installation on a roof

This July, Republicans jammed through the biggest wealth transfer in US history, axing health care and food assistance for millions of Americans and extending a massive tax break for the wealthy. The bill also effectively repealed much of the Inflation Reduction Act, our country’s biggest effort yet to address climate change. The legislation precipitously phases out incentives for solar and wind power, two of the best tools we have to keep our energy bills affordable, our electricity grid reliable, and our communities safer from a spiraling climate crisis.

But try as they might to derail renewable energy, Trump, Republicans, and their fossil fuel industry cronies just don’t have the facts on their side. Even without the full suite of tax credits, solar and onshore wind remain the cheapest sources of new energy generation in the country. Clean energy also remains the fastest form of energy to deploy, critical for tackling surging load growth from data centers and electrification. And with the price of batteries dropping fast, cheap renewable energy can affordably meet more and more of that surging demand, while increasing grid reliability.

While Trump sabotages the cost of living and hundreds of thousands of clean energy jobs, states now have an essential role to play in the race to deploy as much clean energy as we can. Governors and legislators who want to bring down costs for their constituents and make progress against climate change still have many tools at their disposal to ensure clean energy gets built. And now is an urgent moment to do so: State leaders have a narrow window of time to help projects take advantage of the solar and wind tax credits while they still can. The policy menu below is designed to help state leaders seize the urgent moment at hand.

Solar and Wind Are Still the Cheapest and Fastest Ways to Meet America’s Rising Energy Demand

In almost all cases, solar and onshore wind energy are the cheapest forms of new energy generation. That’s according to the International Renewable Energy Agency (PDF) (IRENA) and the Wall Street firm Lazard (PDF).

Let’s look at the hard facts. The Lazard data shows that unsubsidized utility-scale solar PV has a Levelized Cost of Energy (LCOE) ranging from $38 to $78 per MWh, and onshore wind ranges from $37 to $86 per MWh. These figures are generally lower than or competitive with conventional energy sources such as gas combined cycle ($48-$109/MWh) and coal ($71-$173/MWh), highlighting the economic case for clean energy.

Here’s the silver-lining plot twist: Even after the GOP repealed clean energy tax credits via their disastrous megabill, utility-scale solar and onshore wind are still the most cost-effective form of energy in most cases, especially when compared to new-build gas and coal. The cost of building new gas-fired power plants, meanwhile, has hit a 10-year high, according to Lazard’s latest Levelized Cost of Energy+ (LCOE) report, published this June. Simply put, new renewable energy investments are the winning economic choice for developers.

Solar and wind energy isn’t just cheaper—it’s also faster to deploy. Wind and solar projects can be assembled in months, while rooftop solar can be installed in a few days. By contrast, gas plants face long delays from turbine shortages and supply chain disruptions, threatening grid reliability and driving up costs. Utility company NextEra doesn’t expect gas turbines to be available for new plants until the 2030s (PDF).

Here’s the clincher: Renewable energy combined with batteries are showing they can improve grid reliability even at high levels of penetration, like in Texas and California. Costs for battery storage have fallen so drastically in the last few years that it’s now possible to get 97 percent of the way to 24-hour solar electricity supply in the country’s sunniest places—at a price that’s competitive with gas or coal.

And clean, affordable, and fast energy is exactly what we need right now. Across the country, energy demand is climbing. The US grid is under pressure from extreme weather events and load growth from data centers, manufacturing, and electrification. But the answer isn’t more fossil fuels—it’s rapid, cost-effective deployment of modern clean energy infrastructure, which is faster to build than gas and competitive on price.

The Clock is Ticking. States Must Act Fast

Here’s what’s at stake: When the GOP passed its so-called “One Big Beautiful Bill Act” (OBBBA) in July, it imposed new restrictions on federal clean energy tax credits. The new Republican law says that solar and wind projects must commence construction before July 4, 2026, to take full advantage of the Investment Tax Credit (ITC) and Production Tax Credit (PTC). Projects can also use these credits if they are placed in service before the end of 2027. Given the long time it takes projects to win approval for interconnection and complete construction, most projects that want to claim these credits will need to meet the commence construction standard before July 4, 2026.

These projects will also have to grapple with another hurdle imposed via the GOP’s megabill—so-called “Foreign Entity of Concern” (FEOC) requirements. Starting January 1, 2026, developers must prove that they did not receive assistance from so-called “Prohibited Foreign Entities” (PFEs) to remain eligible for the solar and wind tax credits. It’s particularly notable that China, a major global supplier of solar and wind energy components, has been designated a PFE. The FEOC process is still undefined by the U.S. Department of the Treasury and is likely to be so onerous that it will stymie many solar and wind projects for many developers. That’s why it’s critical that developers start construction before the end of this year. For their part, states could pair developers with legal experts to ensure compliance and work to match developers with domestic and other non-FEOC-impacted supply chains.

That gives renewable energy developers and utilities wanting to take full advantage of the tax credits less than a year to meet this construction deadline, and to avoid FEOC challenges, less than 6 months. The time is now for states, local, and Tribal governments to help get as many projects moving as possible.

Of course, even after these deadlines, utility-scale solar and onshore wind power will remain the cheapest option compared to gas and coal. But in the narrow window we have, states and regional actors must do everything in their power to build out clean energy, quickly, at a discount.

To help make solar and wind systems go further, eligible entities can also take advantage of the ITC and PTC tax credits for battery storage, which federal lawmakers left largely intact, though FEOC restrictions will apply. This means that eligible entities can continue to take advantage of subsidized battery storage well after 2026.

Ground view of a large wind and solar panel farm — Mario Tama/Getty Image News via Getty Images

Immediate Actions States Can Take to Deploy Clean Energy

As Trump and Congressional Republicans undermine clean energy programs, states can step up to the plate and lead. Here are four things states should do right away:

1. Coordinate Across Agencies to Help Projects Navigate Barriers

Governors can help companies navigate these complex hurdles by quickly convening a task force to coordinate and streamline across the various state agencies involved in clean energy deployment. We’ve already seen New York form a team like this within the New York State Energy Research & Development Authority (NYSERDA) to help commercial projects quickly troubleshoot and advance towards construction.

Governors and their agencies can also help individuals wanting to claim the consumer tax credits for things like residential solar and electric vehicles (EVs) before they expire by issuing public guidance that clearly outlines the steps and upcoming deadlines. Our friends at Rewiring America have already created a great example of what this could look like.

2. Fast-Track Clean Energy Deployment

Governors and state legislatures should work with local utilities to fast-track renewable energy deployment before the solar and wind tax credits expire. States can look to Maine, a state that is turbocharging plans to procure renewable energy before the federal tax credits expire. In this exciting example, Maine’s PUC has given renewable energy developers a two-week deadline to submit proposals that use contaminated land for clean energy development. To make this procurement process possible, Maine’s legislature also enacted a bill in June with an emergency preamble, allowing the bill to instantly become law, rather than the usual 90 days needed.

3. Quickly Advance Additional Siting and Permitting Reforms for Clean Energy

Governors should consider all other means of streamlining clean energy siting and permitting to cut red tape and empower property owners to deploy clean energy. This should include leveraging existing authorities to decrease state review requirements for solar and wind projects, depending on the local context. Reforms could also include “shot clocks” that require state permit decisions on solar and wind energy within a certain expedited timeframe.

4. Press Regional Transmission Organizations (RTOs) on Interconnection Reforms, While Prioritizing Clearing Clean Project Backlogs

Here’s a big problem: RTOs have long interconnection queues, meaning there’s a waiting list for new power to connect to the existing electricity grid. To build a new energy project, developers need to get permission from their RTO, and this permission process is needlessly slow. For instance, PJM’s study process keeps the average project waiting for five years. There are over 11,000 energy projects (PDF) across the country currently stuck in this interconnection queue. Strikingly, almost all of this backlog is clean energy projects. That’s why states should urgently press RTOs to implement interconnection reforms and prioritize clean energy projects when clearing their interconnection queues. We’ve seen Pennsylvania’s Governor Josh Shapiro effectively use his platform to increase pressure on PJM to speed up their review process.

Laying Groundwork for the Road Ahead

While these urgent actions should be the priority in this narrow timeframe when the tax credits are still available, longer-term policy changes also present major opportunities to reduce costs while tackling climate change. Setting projects up for success now will lay critical groundwork for the road ahead.

Evergreen is excited to be working with our partners across the country to advance changes that will enable states to deliver on clean energy. We’re already seeing some states advance creative solutions to the twin problems of high energy prices and mounting climate impacts. These include efforts to unlock brownfields for solar development, boosting battery storage, and working with Public Utility Commissions to revamp incentives for utilities, and more.

States Have a Duty to Lead

Even after Republicans in Congress have done everything in their power to dismantle the clean energy revolution, solar and wind projects remain the cheapest and quickest form of energy generation in the country—and it’s forecasted to stay that way for years to come.

The clear economic case for renewable energy comes at a time when it’s needed most. With the climate-fueled extreme flooding and heatwaves thrashing communities across the United States this summer, more and more people are demanding ambitious climate action and affordable energy bills to stay cool.

That’s exactly why state leaders and legislators should embrace this win-win opportunity. Deploying solar and wind means keeping household energy bills more affordable while meeting increased demand from new load growth. It can support meaningful climate pollution reductions and help states stay on track to meet their climate goals. And it will create good-paying jobs in a clean energy economy that attracts new industries of the future, rather than continuing to prop up the dirty, health-harming, and expensive fossil fuel infrastructure of the past.

About the Contributors to This Blog

Author - Mattea Mrkusic

Mattea is the senior energy transition policy lead at Evergreen. Her policy research focuses on climate, clean energy, and a swift and just transition away from fossil fuels.