Fossil Fuels Make a Resurgence
The US is ramping up its fossil fuel infrastructure at a pace not seen in a decade, even as the growth of renewable energy is slowing, according to a recent report. Electricity demand is surging faster than it has in over ten years, driven by the increasing number of data centers, factories, and electric vehicles connecting to the grid. Despite this rising demand, the previous administration has worked to undermine the wind and solar sectors in favor of fossil fuels.
The energy landscape in America is already undergoing significant changes, as highlighted in the report from a nonprofit organization and a research firm. If all the gas projects currently in development come to fruition, they could result in long-term pollution and elevated electricity prices, the authors caution. “The U.S. power sector is at a new inflection point, with decisions made today shaping the cost, reliability, and emissions profile of the grid for decades to come,” the report states.
While fossil fuels still account for 60 percent of the nation’s electricity generation, renewables have made impressive strides. In 2024, wind and solar combined produced more electricity than coal for the first time. Solar energy emerged as the fastest-growing source of new electricity generation that year, contributing 81 percent of the added capacity. On a global scale, solar has become the most affordable power source in many regions.
However, the second term of the previous president saw a push for increased fossil fuel extraction, particularly for energy-intensive data centers. His administration attempted to stifle renewable energy initiatives through work stoppages, permit denials, and the elimination of tax incentives. Despite this, there has been a surge in new solar and wind projects, largely benefiting from incentives established during the previous administration.
The trend is shifting back toward gas-fired power plants. Plans for new fossil fuel infrastructure rose from just 5 percent of all new capacity in 2024 to 30 percent by mid-2026, according to the report, which draws on data from the US Energy Information Administration. If this trajectory continues, fossil fuels could represent 70 percent of the development pipeline by the decade’s end, with planned fossil capacity reaching 68 gigawatts by 2030—a 45 percent increase from just six months prior.
Many of these plans could still be derailed, especially if predictions regarding AI data center energy needs are overly optimistic. Currently, however, renewable energy projects are being canceled at a faster rate than fossil fuel projects, with 4.9 percent of renewables scrapped compared to 2.9 percent of fossil fuel initiatives.
When it comes to cost, new utility-scale solar and wind farms still outperform gas, averaging $68 to $69 per megawatt-hour versus $90 per megawatt-hour for new combined-cycle natural gas plants. Additionally, fossil fuels are facing increasing price volatility, particularly in light of geopolitical tensions. Gas and coal power plants also contribute to air pollution and greenhouse gas emissions, leading to higher health costs. As utilities upgrade power grids and expand energy infrastructure to meet growing demand, electricity bills have risen nationwide.
