The study estimates economic and health impacts through 2035, projecting severe losses which include 3,100 additional deaths due to increased pollution, a $206 rise in average home energy costs, a $194 billion loss in GDP, and a $26 billion drop in household disposable income in 2035
Washington, D.C. – The Center for Global Sustainability (CGS) at the University of Maryland released a study today demonstrating how the repeal of key federal environmental and clean energy policies would result in a $1.1 trillion plunge in the U.S. GDP over the next decade, not only threatening clean energy investments and jobs but would also impact people’s health through increased air pollution. This study comes as the U.S. Environmental Protection Agency yesterday announced plans to repeal key power plant emissions rules and Congress considers a mega-spending bill, which would eliminate critical U.S. clean energy and climate policies and programs, add an estimated $3.8 trillion to the U.S. national debt if approved, and loosen emissions limits for toxic substances such as mercury, lead, nickel and arsenic.
“We cannot walk away from the ambitious set of climate policies established in the recent past,” said CGS Director Nathan Hultman. “The United States must continue to pursue a broad clean energy and climate agenda, not only for the health of our planet but because those policies will generate considerable economic benefits, such as hundreds of billions of dollars in GDP increases, and protect U.S. public health and energy security. Our analysis shows that the current budget bill will erode economic growth and put the health of American citizens at greater risk.”
Economy
Investment uncertainty stemming from changes at the federal level, including tariffs, has already contributed to an $8 billion loss due to cancelled or downsized clean energy projects. Halting the planned transformation of the energy system has multi-level consequences on areas including national economic output, household energy costs, and income stability across states. The elimination of clean energy and climate policies would result in the following:
- Households would suffer a nearly $160 billion loss in disposable income by 2035, with a $26 billion loss in 2035 alone due to the cascading effects of repealing clean energy tax credits and direct subsidies.
- In addition to the U.S. GDP loss of $1.1 trillion by 2035, state-level GDP would also be affected across the U.S. The distribution of economic impacts is uneven across states, dependent on state-level characteristics including the economy size, fossil fuel reliance, projected renewable energy resources, and interstate trade. In terms of absolute GDP loss as well as percentage GDP loss, the most affected are Texas, Michigan, Indiana, Montana, Alaska, Wyoming, and Vermont (Fig. 4).
- At the household level, repealing low-cost clean energy and energy efficiency programs would increase annual energy costs by hundreds of dollars. The study explains that home energy costs would rise by $206 per year in 2035 with federal policy rollbacks. In some states, household costs could reach $339 annually by 2035. Coupled with an overall decrease in household disposable income, the economic ramifications would be felt across 50 states.
Fig 4. Absolute changes in state-level GDP in 2035 under Federal Rollbacks relative to Current Policies.
Health
Though the continued takeback of federal funding and yesterday’s rollbacks of key environmental regulations would have uneven effects across states and sectors, all states would see an increase in pollution and health impacts.
- Some states would see a significant percentage increase in deaths due to increased particulate matter 2.5 (PM2.5) in the atmosphere, one of the most harmful pollutants, mainly released through fossil fuel combustion. The most impacted states include West Virginia (14%), North Dakota (13%), Pennsylvania (9%), Virginia (9%), Ohio (9%), and Kentucky (9%).
- The data suggests that states with weaker clean energy policies and a reliance on coal and combustion-based heating would see the largest increase in negative health effects, while states with cleaner energy profiles as a result of policy, including Renewable Portfolio Standards (RPS), coal phaseout plans, and market forces, would see a smaller uptick in PM2.5-related deaths.
“Importantly, today’s study assumes consistent levels of climate action from non-federal actors, including states, cities, businesses, tribes, hospitals, and more, which have the potential to help counter some of the federal rollbacks,” said Ryna Cui, Research Director and Associate Research Professor at CGS. “As CGS has demonstrated in previous analyses, states are uniquely positioned to adopt policies that reflect local needs, capacities, and economic contexts.”
In addition to modeling the impacts of federal clean energy rollbacks, the study highlights real-world examples of federal clean energy policy implementation, demonstrating the significant economic and health advantages already achieved across states, cities, businesses, healthcare facilities, schools, and more.
A forthcoming CGS report will update the analysis to reflect the current state of federal policy and explore the ways in which non-federal actors can lead on climate action if the current budget bill is passed.
Read the report here.
