Although President Donald Trump has made bringing down energy prices a goal of his second term in the White House, they have been climbing in the U.S. What’s going on?
Per the U.S. Bureau of Labor Statistics, the energy index was on a downward slide over the 12-month period ending in June, decreasing 0.8%. However, it rose 0.9% last month. Increases in gasoline, fuel, electricity and piped gas service were recorded.
“Analysts previously indicated that a spike in natural-gas prices, surging loads from artificial intelligence-driven data centers triggering multibillion-dollar capacity charges, and an aging, congested grid were among the reasons Americans could see higher energy and electricity prices this summer,” said Newsweek. It also said that growth in the artificial intelligence (AI) and cryptocurrency industries is putting strain on the power grid.
POLTICIO noted this week that the Trump administration just outlined its plans to dominate the AI sector, including plans to expand the power grid. In fact, the administration called the grid “the lifeblood of the modern economy and a cornerstone of national security.”
While on the campaign trail last year, Trump penned an op-ed for Newsweek in which he said his administration would “cut energy and electricity prices in half within 12 months.
On his inauguration day, the White House issued a statement that said: “In recent years, burdensome and ideologically motivated regulations have impeded the development of these resources, limited the generation of reliable and affordable electricity, reduced job creation, and inflicted high energy costs upon our citizens. These high energy costs devastate American consumers by driving up the cost of transportation, heating, utilities, farming, and manufacturing, while weakening our national security.”
Despite the Trump administration’s goals, POLITICO also reported Wednesday that when the Energy Department announced the termination of a pending $4.9 billion loan guarantee for the Grain Belt Express project. That project is an 800-mile transmission line “that would carry mostly wind-generated power from the Plains to some of the most strained parts of the nation’s power grid,” said the outlet.
It also said that the move has “left some power sector experts, business leaders and lawmakers on both sides of the aisle baffled,” Still, it does fall in line with the president’s preference for fossil fuels and nuclear power, POLITICO said.
According to Newsweek, grid operator PJM offered further context for the recent rise in energy prices.
“Economic growth is driving a massive uptick in electricity demand. Existing supply has been leaving the system due primarily to state and federal decarbonization policies and some economics,” a PM spokesperson said.
A Thursday press release from the Maryland Association of Counties warned residents there that they should “brace for higher electricity rates after PJM’s latest capacity auction reached the federal price cap, underscoring growing reliability concerns and a supply-demand mismatch across the grid.” That auction is PJM’s tool for securing a sufficient electricity supply to meet future demand, the association explained.
Both Newsweek and POLITICO said the White House declined to comment on higher energy prices or the loan guarantee cancellation.
In a Tuesday press release, the U.S. Department of the Interior said that the One Big Beautiful Bill Act will usher in “key changes that will promote U.S.
energy production, timber development and other regulatory actions needed to ensure the responsible management of our natural resources and public lands.” It said those changes will include oil and gas development (both offshore and onshore), coal development, water infrastructure and hydropower.