A structural restriction on permitting new solar and wind energy resources will directly penalize U.S. ratepayers and undermine grid function, said a new report. According to a macroeconomic modeling study conducted by NERA Economic Consulting for the Corporate Energy Buyers Association (CEBA), blocking the economic deployment of renewable energy could cost the United States an additional $121.2 billion in cumulative electricity and natural gas costs between 2027 and 2033.
The report outlines how the U.S. electricity system faces massive demand growth from data centers and artificial intelligence expansion. The authors, led by NERA Managing Director Sugandha Tuladhar, PhD, evaluated four distinct market scenarios comparing a system of permitting neutrality against one where wind and solar additions are artificially restricted. The findings show that suppressing clean energy generation locks in higher structural costs by forcing regional networks to build expensive, fossil-fuel-dependent backup systems, such as natural gas “peaker” plants.
The authors indicate that the financial fallout of these restrictions will hit residential consumers hardest.
Over the seven-year study period, American households will face an $81.2 billion increase in energy expenditures, which translates to an average penalty of $11.6 billion annually. NERA analysts applied consumer expenditure data to show that the typical household will pay an extra $59 per year for natural gas and $26 per year for electricity if clean energy cannot compete on pure economics. Commercial and industrial electricity customers will absorb the remaining $40 billion of the penalty, paying an extra $5.7 billion annually.
Regional power markets will bear these cost increases unevenly, with competitive wholesale markets seeing the most severe price spikes. The authors project that electricity prices in the ERCOT grid in Texas will jump by as much as 22% under constrained scenarios, resulting in a localized $21 billion cumulative cost spike. The New York Independent System Operator (NYISO) region follows with an expected 11% price hike, while the broader West region will see prices rise by 9%. Across all competitive U.S. electricity markets, average retail power prices will scale up by 10% to 11% without clean energy competition.
The report highlights a dangerous secondary effect of restricting renewable development: a severe supply chain squeeze for thermal generation. If solar and wind builds are frozen, the United States must build between 32 GW and 38 GW of new natural gas capacity above baseline projections just to keep the lights on. NERA researchers point out that advanced gas turbines are already sold out years in advance due to competing data center load, and real-world procurement costs have surged 36% above planning estimates.
Relying entirely on a single fuel source to meet peak load creates long-term reliability risks. The NERA model demonstrates that under an open market, a combination of 135 GW to 143 GW of solar and up to 297 GW of onshore wind would naturally deploy based on cost-competitiveness. This clean energy mix lowers the share of peak-hour generation supplied by natural gas from a dangerous 43% down to a diversified 27%.
The authors conclude that technology-neutral permitting reform is the only viable pathway to shield consumers from fuel price volatility and ensure a stable, low-cost power grid. Suppressing private clean energy development will simply pass the multibillion-dollar burden of a congested, fragile energy system back to the public ratepayer.
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