How US renewable-energy growth persists despite federal policy uncertainty
Dhruv Modi, research analyst, Center for Global
Sustainability, University of Maryland
Alicia Zhao, research manager, Center for Global
Sustainability, University of Maryland
Tyler Stotland, research analyst, Center for Global
Sustainability, University of Maryland
Prof Nate Hultman, director of the Center for Global
Sustainability, University of Maryland, and professor in the School of Public
Policy, University of Maryland
Despite recent shifts in federal energy policies, our
analysis shows that the US transition to renewable energy is continuing.
The current administration has enacted a range
of changes to prioritize fossil-fuel energy and environmental
deregulation in the US, while withdrawing support
for renewables.
Yet solar, wind and battery storage accounted for over 90%
of new energy capacity in 2025.
This is thanks to the falling cost of
renewable energy technologies, investments spurred
by the Inflation
Reduction Act and Bipartisan Infrastructure Law and local
and state policies, according to our research at the Center for Global
Sustainability, University of Maryland.
Our analysis examines
recent trends in the US energy landscape, focusing on rising electricity
demand, new electricity capacity additions and generation, as well as
fossil-fuel production and state-level case studies.
Rising electricity demand in the US
A key shift in the calculus is the fact that US electricity
demand is now projected to increase rapidly, after a period of relative
stagnation.
Between 2005 and 2020, electricity demand was relatively
flat, after surging
in the 1990s due to growth in the economy and population, as well as
rising electrification.
However, as the chart below shows, demand has grown by 7%
since 2020 – and this is set to accelerate.
Rising transport electrification, along with new demand from data centres, buildings and industry are expected to drive additional electricity growth in the near term.
Our
recent report finds that US electricity demand could increase by
24-34% in the next decade, relative to 2021 levels, as shown in the figure
below. It shows that electricity demand would be higher if there is enhanced
climate ambition, due to higher shares of electrified transport, industry and
buildings.
While demand has been relatively flat over the past decade
or two, there have been major shifts in the source of electricity supply over
this period.
(Note that changes in generating capacity do not correspond directly to
patterns in electricity demand shown earlier.)
Whereas huge numbers of gas-fired power plants were built in
the 2000s, renewable energy has been the primary source of new capacity for the
past decade. With demand largely flat, much of this new capacity helped offset
the loss from significant coal retirements during this period.
Indeed, capacity additions from renewable energy have
outpaced that of every other technology since 2011, according to our
research.
Accelerating renewable-energy buildout is increasingly viewed as
an immediate, low-cost and practical solution to meet demand growth.
As shown in the figure below, additions of solar, wind and
battery storage capacity reached more than 90% of total additions in 2024 and
2025 at 47 gigawatts (GW) and 48GW a year, respectively.
This pace of renewable deployment is attributable to quickly
declining costs, driven by improvements in manufacturing technology,
maturing supply chains and better economies of scale.
Meanwhile, 112GW of coal capacity was retired over the last
decade due to market forces, health concerns and clean-energy policies.
Gas-power additions have remained at a low but steady level,
our research shows.
Renewables surpass coal
As a result of the shifts in generating capacity, solar
generation has increased nearly tenfold over the last decade, while wind
generation has doubled.
As such, solar and wind reached 9% and 10% of the generation
mix last year, respectively, as shown in the chart below.
Coal generation has fallen by more than 50% over the same
period, replaced by a combination of renewables and gas, which has risen
steadily.
(Note that coal-power output increased in 2025, primarily due
to higher gas
prices, while federal
policy changes forced some old plants to stay open.)
Gas generation has steadily increased in the US, reaching a
39% share of the generation mix last year. Roughly speaking, the growth in wind
and solar – around 600 terawatt hours (TWh) – in the past decade was
sufficient to match the decline in coal generation, while growing gas
generation covered the roughly 300TWh increase in demand through 2025.
As a result, as shown in the figure below, fossil-fired
electricity as a whole has fallen to 56% of the mix.
Our research shows that a rapid renewable energy buildout is
occurring across states regardless of political allegiance, driven by strong
economic advantages, policies such as state “renewable
portfolio standards” and other environmental and health benefits.
Over the last decade, land- and wind-rich states such as
Texas, Oklahoma and Iowa, have accounted for 62% of new wind capacity.
Meanwhile, “sun-belt” states
such as Texas, California and Florida have built 52% of new solar capacity.
Clean-energy policies have further driven renewable
deployment. For example, California has a binding law requiring 100% of
electricity to come from renewable and zero-carbon energy sources by 2045, with
an interim target of 60% by 2030.
This has contributed to a 44% renewable generation
share in the state in 2025, up from 16% only a decade ago.
Similarly, New Mexico has a legislated goal to reach 80%
renewable electricity by 2040 and 100% zero-carbon electricity by
2045.
More
than half of New Mexico’s electricity is now generated by renewables,
up from only 9% in 2015. The state’s 3.5GW SunZia wind and transmission project
is set to be the largest
renewable energy project in the western hemisphere when completed.
At the same time, our research suggests that the increasing
partisanship of climate policy has been a key barrier for many states.
Some states have tried to restrict climate action, spanning
a potential solar-farm
construction moratorium in Alabama to a ban on net-zero policy and
greenhouse-gas regulation in Florida.
Renewables transcending politics
Importantly, the factors driving the transition to
renewables are now frequently transcending politics.
Our research shows that lower cost, quick-to-deploy and
energy-secure renewables make practical sense in many market contexts in the US
– and globally. Businesses, local governments and consumers are voting
with their wallets to address immediate needs.
For example, Texas leads the nation in renewable-energy
expansion, despite its lack of decarbonization goals. Texas’ deregulated
power grid and lighter permitting processes, combined with its
abundant renewable resources and falling technology costs, have increased
renewable electricity capacity to nearly 90GW in 2025.
The state now generates more
power from solar farms than coal plants.
Public health is another driver of the clean-energy
transition that transcends politics, our research suggests. Oregon, for
example, passed a law in
2016 to phase out all coal-generated electricity by 2035, which the state
deemed “necessary for the immediate preservation of…public health and
safety”.
Data center development and energy affordability are also
shaping state policy landscapes.
Virginia – which has the highest
number of data centers of any US state – just passed new laws to allow
for more
efficient grid utilization and to shift energy costs
towards data centers while assisting low-income households with energy
efficiency improvements.
The figure below shows how widespread renewable-energy
development now crosses state and political divides, even though it remains
constrained to some extent by geography.
Between 2010 and 2020, state and federal policies helped
spur renewable energy, with particularly strong growth in states like
California and North Carolina.
More recently, declining costs and improving economics have
become increasingly important drivers of renewable energy expansion, even amid
increasing political and policy setbacks in
some regions. This has contributed to a broader dispersion of solar and wind
deployment across US states between 2020 and 2025.
New electricity capacity additions by technology and plant
size across the US in each period. Source: University of Maryland analysis of
EIA data
While most domestic
economic sectors are still fossil-fuel heavy and current US energy
security priorities promote continued
fossil production, this fossil-fuel reliance has shifted over the past decade
away from coal mining towards oil and gas drilling.
Coal production has fallen more than 40% over the last
decade, tracking the decline in domestic coal consumption, as shown by the red
line in the lower figure below.
In contrast, oil and gas production and exports have grown
steadily since 2008, with the US becoming a net liquified natural gas (LNG)
exporter over the last decade.
However, recent upheavals in
the Middle East have underscored the country’s continued exposure to global
fossil- energy markets.
Our research shows that renewable energy deployment in the
US today is rooted in its practicality and cost-effectiveness. These advantages
are allowing it to outcompete fossil-fuel technologies in terms of electricity
capacity expansion, even across varying political landscapes.
Nevertheless, policy continues to influence the sector.
Coupled with parallel strategies for vehicle transport
electrification, renewable deployment would offer lowered risks to consumers
and businesses from fossil-fuel price volatility.
