Decade-long growth trend begins to reverse
After more than ten years of rapid expansion, the United States clean energy economy is showing clear signs of strain. Billions of dollars had flowed into battery plants, electric vehicle factories, and solar and wind generation as costs declined and demand surged. While much of the world continues to accelerate its energy transition, momentum in the US has begun to slow sharply.
A new analysis from the clean energy research group E2 shows that 2025 marked a turning point. New clean energy investment announcements were overwhelmed by project cancellations, closures, and downsizing already underway.
Cancellations outweigh new projects
According to the report, for every dollar announced in new clean energy projects last year, roughly three dollars’ worth of existing projects were canceled or scaled back. In total, an estimated $35 billion in clean energy investments were abandoned in 2025 alone. By comparison, cancellations in 2023 and 2024 combined amounted to just $3.4 billion.
Researchers described the reversal as striking given the pace of expansion in prior years. Globally, governments and companies are largely doubling down on renewables, while the US policy environment has become increasingly hostile to clean energy industries.
Trump policies cited as central factor
E2 researchers point to the return of President Donald Trump as the main driver of the slowdown. Companies began pulling back investments shortly after the November 2024 election, when Trump signaled a renewed focus on fossil fuels and opposition to renewable energy incentives.
Shortly after taking office, the administration paused offshore wind leasing and permitting, leading several developers to halt or abandon projects while legal challenges moved through the courts. At the same time, billions of dollars in federal funding for clean energy initiatives were withdrawn, and multiple Biden-era programs were rolled back or reworked.
Tax credits and EV incentives rolled back
Congress further reshaped the landscape by passing the One Big Beautiful Act, which sunset major tax credits for renewable power. The legislation also dealt a significant blow to the electric vehicle sector by eliminating consumer EV tax credits and ending investment incentives for battery manufacturing.
The combined effect of these moves has been widespread uncertainty. Companies have struggled to plan long-term investments amid shifting rules, changing tax policy, and an unclear regulatory outlook.
EVs and batteries hit hardest
Electric vehicle and battery manufacturing suffered the largest losses. Each sector saw roughly $21 billion in investment disappear over the past year, according to E2’s analysis. Together, these pullbacks represent an estimated 48,000 potential jobs that will no longer materialize.
Automakers revised expectations for US EV demand once federal consumer credits were repealed, prompting companies to redirect or delay investments rather than expand capacity.
States feel uneven impact
Some states were disproportionately affected. Michigan, the center of the US auto industry, lost 13 clean energy projects worth $8.1 billion in 2025 alone. Illinois, Georgia, and New York also recorded multibillion-dollar investment losses.
In several cases, companies opted to repurpose facilities rather than abandon them entirely. Ford, for example, shifted plans at its Ohio Assembly Plant from all-electric vehicles to gas-powered and hybrid vans, keeping the facility operational but postponing EV production.
Uncertain outlook, cautious optimism
While the current environment discourages new investment, some analysts see a potential upside. Facilities that remain intact could be converted back to clean energy production if policies stabilize and market conditions improve.
For now, however, the US clean energy sector faces its most uncertain period in more than a decade, shaped less by technology or demand than by politics and regulatory volatility.
