Three Years After the Inflation Reduction Act Became Law, Trump Raises Energy Costs on Working Families

WASHINGTON, D.C. — August 16, 2025, marks the three-year anniversary of the Inflation Reduction Act — a historic piece of legislation that lowered costs for American families, created good-paying jobs for American workers, and sparked an American manufacturing renaissance. The GOP proudly boasts about rolling back this monumental law — a move that has already had immediate and profound consequences for hardworking families.

In response, Groundwork Collaborative Chief of Policy and Advocacy Alex Jacquez released the following statement:

“The Inflation Reduction Act ushered in a new era of American energy independence and a domestic manufacturing boom that saw nearly 1,000 manufacturing plants announced across the country. This meant more jobs, lower costs, and more cash in the pockets of hardworking families. Republicans gladly touted new jobs, investment, and lower electricity bills in their districts. Now, they shamelessly yanked jobs from American workers, gleefully increased electricity bills on American families, and ecstatically put the nation’s energy future in the hands of foreign nations.”

Email press@groundworkcollaborative.org to speak with a Groundwork expert about the Inflation Reduction Act.
 

Background on how the near-full repeal of the Inflation Reduction Act in the GOP budget law makes life more expensive:

• Costing Americans Jobs and Economic Growth: The Inflation Reduction Act created over 400,000 new jobs and $600 billion of private investment in clean energy. Instead of building on that success, the Republican budget law is expected to cost 760,000 jobs and reduce annual GDP by $130 billion in just five years.
• Raising Utility Bills: Households will soon spend over $280 more in energy costs per year thanks to the Republican budget law’s near-full repeal of clean energy tax credits. Families in some states may see their energy costs go up by more than $600 per year.
  • The grid is increasingly at risk of failing to meet soaring demand, which is set to double in the next five years as AI and data centers proliferate. With the Republican budget law expected to reduce domestic electricity generation capacity, Americans will see sky high electricity bills and a less resilient energy supply. These utility rate hikes are already putting more stress on consumers’ pocket books. For example, the 65 million Americans in the 13-state PJM service area will pay an additional $240 annually, starting this year.
  • New polling from Navigator Research found 70% of voters, including majorities across party lines, report rising utility costs. Nearly a third (32%) of voters say their utility costs are going up a lot. Concerns about utilities have been high for months, with a March survey from Powerlines and IPSOS finding two in three voters say their utility bills are a source of financial stress and four in five voters feel powerless over the costs of their utility bills.
• Increasing the Price of a Home and Home Improvements: A more energy efficient home means more savings for homeowners. The Republican budget law repealed the following tax credits which were saving American families thousands of dollars each year:
  • The Residential Clean Energy Credit, which covered up to 30% of the costs of installing rooftop solar panels. Families that installed solar panels saved a median of $2,230 a year on their utility bills.
  • The Energy Efficient Home Improvement Credit, provided up to $3,200 in tax credits for taxpayers who made energy efficiency improvements to their homes, like installing electric heat pumps and Energy Star-certified windows. Homes with these upgrades are expected to save up to $3,100 per year.
  • The New Energy Efficient Home Credit, which incentivized the construction of energy efficient homes and was estimated to spur the construction of 3 million homes in the next few years. Now, builders that were expecting the credit will likely pass the cost on to buyers or cancel the construction of new homes altogether, further disrupting the housing supply and increasing costs.
• Increasing Gas Prices and Commuting Costs: By 2035, the price of gasoline could rise by up to 37 cents per gallon as a result of the proposed termination of electric vehicle (EV) affordability programs and a provision that weakens existing fuel economy standards. Paired with the termination of $240 in annual pre-tax benefits for those who commute by bicycle — which will increase demand for liquid fuel and further drive up gas prices — there’s no good way to escape increased commuting costs.
• Increasing the Price of a New Car: Republicans terminated the $7,500 tax credit for the purchase of new EVs ($4,000 for buying a used EV). On top of increased vehicle costs, Americans could also miss out on up to $2,200 in annual savings on fuel expenses.