Economic Consumer Cost and Pollution Impacts of Federal Energy Policy Changes

This report by Energy Innovation uses the Energy Policy Simulator to model the economic, public health, and energy cost impacts of federal policy changes enacted during the second Trump administration and the 119th Congress between 2026 and 2040. The analysis focuses on seven key policy shifts, including the One Big Beautiful Bill Act (OBBBA), the repeal of EPA greenhouse gas and tailpipe emissions standards, and the cancellation of the $7 billion Solar for All grant program.

• Federal policy changes are projected to significantly increase energy costs for households, with a total additional cost of $650 billion. This averages to $460 per household in 2035 and $490 per household in 2040.
• The reduction of policies supporting transportation innovation and efficiency is expected to drive up gasoline prices by 14 percent in 2035 and 26 percent in 2040, compounded by market pressures such as the Iran war.
• The U.S. economy is projected to suffer a cumulative GDP loss of $2.3 trillion due to slowed electrification and domestic energy manufacturing. Annual GDP losses are estimated at $150 billion in 2030, peaking at $250 billion in 2032, then falling to $200 billion in 2035 and $120 billion in 2040.
• Employment will be negatively impacted by the OBBBA and reduced federal support for innovation, resulting in an average loss of 820,000 jobs per year over the next decade. This follows an initial loss of 144,000 clean energy jobs in the 18 months prior to the report.
• Increased local air pollution resulting from these policy changes is expected to raise healthcare costs by $43 billion, with annual increases of $4 billion in 2035 and $4.5 billion in 2040.

APA

Marcacci, S. (2026). Economic Consumer Cost and Pollution Impacts of Federal Energy Policy Changes. Energy Innovation. https://energyinnovation.org/report/economic-consumer-cost-and-pollution-impacts-of-federal-energy-policy-changes/

Chicago

Marcacci, Silvio. Economic Consumer Cost and Pollution Impacts of Federal Energy Policy Changes. Energy Innovation, 2026. https://energyinnovation.org/report/economic-consumer-cost-and-pollution-impacts-of-federal-energy-policy-changes/.

Wikipedia

{{cite report |last1=Marcacci |first1=Silvio |title=Economic Consumer Cost and Pollution Impacts of Federal Energy Policy Changes |publisher=Energy Innovation |date=7 July 2026 |url=https://energyinnovation.org/report/economic-consumer-cost-and-pollution-impacts-of-federal-energy-policy-changes/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{marcacci2026economic, author = {Marcacci, Silvio}, title = {{Economic Consumer Cost and Pollution Impacts of Federal Energy Policy Changes}}, institution = {Energy Innovation}, year = {2026}, month = jul, url = {https://energyinnovation.org/report/economic-consumer-cost-and-pollution-impacts-of-federal-energy-policy-changes/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }