New Regulatory Complexity Ahead
The "One Big Beautiful Bill" was signed into law on July 4, 2025, marking significant changes to U.S. energy policy. The legislation removes federal tax incentives for renewables and shifts energy development priorities, creating consequential impacts on utilities, renewable energy project developers, energy technology companies and consumers.
As the economics of renewable energy development are fundamentally altered, new regulatory challenges will unfold in the energy sector, leaving the industry to navigate complex and vital issues:
Renewable Energy Development
The legislation phases out tax credits that support renewable energy development and adds potential tax penalties, making projects less economically feasible to construct and operate. This impacts renewable portfolio standards, clean energy targets and the pace of the transition to wind and solar energy.
Resource Planning and Capacity
A decline in wind, solar and battery installations will reduce generation supply at a time when load growth is projected to increase, due in large part to power demand from data centers. This creates significant resource planning challenges for utilities that will now experience more uncertainty about projects that can or will be brought online.
Affordability and Reliability
By potentially removing additional sources of new electricity as energy demand increases, utilities may turn to more expensive alternatives that require significant time and cost to build. Companies and regulators will have keen interest in impact to customers while maintaining the responsibility to ensure reliability.
Regulatory Developments to Watch
The story of how the energy industry adapts to this new legislation will be told in the documents that utilities file and the decisions regulators make in the coming months and years. For energy industry stakeholders, understanding these changes requires large-scale visibility into regulatory proceedings.
"The regulatory data emerging from state proceedings will indicate how well we navigate this transition. Utilities are going to face some tough choices when their procurement strategies suddenly don't pencil out, and they must find alternative ways to meet electricity demand. Load growth is happening right now and utilities will need renewables for their portfolios, while regulators will have to find a way to balance keeping the lights on with keeping rates affordable."
- Neil Chatterjee, former FERC Chairman
Here are four areas to monitor to understand how the bill is shaping state-level regulatory developments and decisions:
Adjusted Project Timelines
Renewable energy projects have 60 days following the bill's enactment to begin construction, with projects needing to be placed in service by the end of 2028 in order to maintain tax credit eligibility. Rapid project development decisions must now occur with potential for emergency or expedited reviews requested of regulators. Tracking the frequency and outcomes of these accelerated processes can reveal which states are adapting most effectively to the new regulatory environment.
Changes to Resource and Reliability Planning
Integrated resource plans previously filed by utilities and approved by regulators will likely require revisions as renewable energy project economics change. With fewer renewable projects generating power to meet demand, and relatively long lead times required to bring other new energy sources online, regulators may need to consider the extended operation of existing facilities. As utilities update capacity planning assumptions, renewable energy procurement strategies and grid reliability assessments, IRP revisions provide an early indication of supply constraints and investment shifts.
Rate Case Acceleration
State utility commissions may see an influx of new rate cases as utilities seek cost recovery for alternative resources that may carry higher costs than previously planned renewable projects. By tracking these cases across jurisdictions, stakeholders can identify patterns in how utilities are responding to a potential new economic reality and how regulators are balancing competing priorities of affordability, reliability and sustainability.
"Now more than ever, state regulators can benefit from the use of AI and analytics to prevent regulatory lag and maintain effectiveness in regulation."
- Lila Jaber, former Chair of the Florida Public Service Commission
Cost Recovery Mechanisms and Approvals
State commissions will need to address cost recovery issues for renewable projects that become uneconomical and evaluate how to handle cancelled or modified projects and their associated costs. Watching decisions on potential stranded assets, and how cost recovery is distributed between shareholders and ratepayers will be critical to monitor as these proceedings begin to take place.
The Role of Centralized Data & AI
Understanding how the energy sector adapts to "One Big Beautiful Bill" requires visibility into the regulatory process where these changes are actually implemented. As the energy industry navigates this transition, technology can be leveraged in three important ways:
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Proactive and automated monitoring of regulatory developments as they occur
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AI-assisted research and analysis to help gain a thorough understanding of issues
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Centralized regulatory data and search capabilities to find information specific to states, utilities and projects
“Smart use of technology is a strategy we can all stand behind to drive regulatory efficiency and swift decision making. Together we must focus on ensuring reliability, and as we build the infrastructure we need to meet growing power demand, better regulatory intelligence can help us cut through the complexity."
- George P. Bush, former Texas Land Commissioner and attorney
Whether it’s a utility trying to pivot its resource strategy, or a state commission dealing with an avalanche of new filings, having real-time visibility and accelerated insights positions all parties to act more quickly with more comprehensive data at hand.
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