Why the U.S. Is Letting China Win on Energy Innovation
At the same time, household energy spending in the US is expected to increase by US$170 (£126) each year between now and 2035 as a result of Trump’s One Big Beautiful Bill Act. The bill, which includes sweeping changes to taxes, social security and more, will raise energy costs mainly because it strips away support for cheap and abundant renewables like wind and solar.
Household energy costs could go up even more as Trump threatens to make large‑scale clean energy development much more onerous by putting up bureaucratic hurdles. The administration recently issued a directive requiring the secretary of the interior to approve even routine activities for wind and solar projects connected to federal lands.
Meanwhile, climate change is hitting American communities harder with each passing year. As recent flooding in Texas and urban fires in California and Hawaii have shown, fewer Americans still have the luxury of ignoring climate change.
As the cost of these disasters mount – US$183 billion in 2024 – the grifting of the oil and gas industry will become an increasingly bitter pill for the nation to swallow.
China’s Foresight
China, with its authoritarian government, is less susceptible to the petroleum-obsessed dogma fueling the Republican party. It does not have prominent leaders like US politician Marjorie Taylor Greene, who previously warned that Democrats are trying to “emasculate the way we drive” by advocating for electric vehicles. Rather, China’s leaders are seeing green – not in the environmental sense, but in a monetary one.
It is generally cheaper nowadays to build and operate renewable energy facilities than gas or coal power stations. According to a June 2025 report by Lazard, an asset management company, electricity from new large-scale solar farms costs up to US$78 per megawatt hour – and often much less. The same electricity from a newly built natural gas plants, by comparison, can cost as much as US$107 per megawatt hour.
Across the world, utilities are embracing clean energy, choosing lower costs for their customers while reducing pollution. China saw the writing on the wall decades ago, and its early investments are bearing a rich harvest. It now produces more than half of the world’s electric vehicles and the vast majority of its solar panels.
The US can still compete at the leading edge of the energy sector. American companies are developing innovative new approaches to geothermal, battery recycling and many other energy technologies.
But in the battle to become the world’s 21st-century energy manufacturing powerhouse, the US seems to have walked off the playing field.
In Trump’s telling, the US may have simply exited one race and reentered another. But the fossil fuel industry – financially, environmentally and ethically – is obviously a dead end.
Stephen Lezak is Program Manager at the Smith School of Enterprise and the Environment, University of Oxford. This article is published courtesy of The Conversation.
