How will Trump's 'big, beautiful' bill affect climate change?

President Donald Trump's 'big, beautiful' budget bill, which rolls back climate and clean energy-related provisions, was passed by the U.S. Congress in early July.

The Trump administration has called the measure "transformative" and said it will head off looming tax hikes and unleash "clean, American-made energy."

But environmental advocates worry the package will hurt the United States' efforts to combat climate change and curb the use of clean energy in the world's second-largest emitter of greenhouse gases, behind China.

Here's what to know:

What is happening to the bill?

Congressional Republicans passed Trump's massive spending bill by razor-thin margins in the House and Senate, approving a package that would extend expiring tax cuts, cut the social safety net and boost immigration enforcement spending while adding an estimated $3.3 trillion to the national debt.

The bill repeals many of former President Joe Biden's green energy incentives, including some in his signature climate bill called the Inflation Reduction Act.

The Environmental Protection Agency announced on August 7 it would end "Solar for All," a $7 billion grant programme intended to help low-income homes secure solar power.

In a post on X, EPA Administrator Lee Zeldin said the bill effectively negated funding for Solar for All.

"EPA no longer has the authority to administer the program or the appropriated funds to keep this boondoggle alive," he said.

The bill also reduces spending on the Medicaid health programme and food aid for low-income Americans.

How could the bill affect carbon emissions?

The measure is projected to increase greenhouse gas emissions relative to the current baseline, according to multiple projections.

Under the new law, greenhouse gas emissions are still projected to shrink 27% to 44% below 2005 levels in 2035, according to a report from the Rhodium Group, a think tank.

But that is nevertheless a significant 315 to 574 million metric ton increase in emissions that year compared with a baseline level, according to the report.

What are the major clean energy provisions in the legislation?

The Senate had been considering a new excise tax on renewable energy as part of the budget bill, but lawmakers dropped the proposed tax before passing the broader legislation.

Despite this, Republican lawmakers are seeking to unwind some tax credits - or tax breaks - for renewable energy that had been included in the Inflation Reduction Act, passed in 2022 during Biden's administration.

These tax credits include breaks for "clean" vehicles and energy-efficient homes, among others.

The bill also attempts to roll back funding for a programme intended to help oil and natural gas producers cut methane emissions.

The bill makes it "much, much harder to build new clean energy projects," said Joanna Slaney, vice president for political and government affairs for the Environmental Defense Fund (EDF), an advocacy group.

She said the bill "favours burning more fossil fuels while ignoring the damage it will do to people's lives."

The oil and gas industry, meanwhile, is praising the legislation, which could expedite new potential lease sales tied to fossil fuel projects. The bill directs the Department of the Interior to resume quarterly onshore oil and gas lease sales, which were limited under Biden.

"This historic legislation will help usher in a new era of energy dominance by unlocking opportunities for investment, opening lease sales and expanding access to oil and natural gas development," said Mike Sommers, CEO and President of the American Petroleum Institute (API).

What else are environmental advocates saying about the bill?

Despite the removal of the excise tax, the bill "is still devastating for the clean energy transition," said Gretchen Goldman, president of the Union of Concerned Scientists, a non-profit group.

"The provisions attacking clean energy and clean transportation are not about the budget, but rather Congress using the budget bill to boost fossil fuels by crushing these booming new industries," Goldman said.

Clean energy advocates warn that the rollbacks will ultimately raise electricity prices for American consumers.

"It will only exacerbate the growing strain on the electric grid," said Steven Nadel, executive director of the American Council for an Energy-Efficient Economy (ACEEE), a non-profit research group.

"And the bill goes out of its way to encourage automakers to produce inefficient cars that are costly to fuel."

This story was updated on Friday August 8, 2025 at 14:45 GMT to reflect the latest developments.

(Reporting by David Sherfinski; Editing by Jon Hemming, Ana Nicolaci da Costa and Ellen Wulfhorst.)