【By Chen Sijia, Observer News】The "big and beautiful" tax cut and spending bill pushed by US President Trump has been submitted to the US Senate. After more than 24 hours of marathon-style amendment debates, its final fate remains uncertain. This bill plans to extend corporate and individual tax cuts from Trump's first term. To compensate for the loss of tax revenue, the bill proposes to cancel subsidies for new energy projects such as wind and solar power.
However, analysts have warned that this move will worsen the United States' disadvantage in the "electrification race." According to a report by Bloomberg News on July 1st, the development of electrification in the United States has been stagnant since 2000, and the transformation of the energy structure has lagged far behind Asia. If subsidies for new energy projects are canceled, the U.S. electrification process will face greater difficulties, and it may even be difficult to meet the growing demand for electricity.
Aerial transmission lines in Texas, USA - Bloomberg News
A report released last week by the UK-based new energy think tank Ember pointed out that the growth in electricity demand is driving Asian economies to vigorously develop the manufacturing of basic power equipment. Countries such as Vietnam, Bangladesh, and Indonesia have rapidly increased the proportion of electricity in their energy structures, with the speed of electrification exceeding that of the United States. In contrast, the level of electrification in the United States and Europe has hardly increased over the past two decades.
Daan Walter, a researcher at Ember, said that for countries seeking economic development, electrification is now a "more important competition." Using electricity not only helps improve efficiency and reduce operating costs, but also industries supporting electrification, such as electric vehicle manufacturing, are growing faster than other industries.
The Financial Times reported on May 5th that the Rocky Mountain Institute (RMI) found, based on data from the International Energy Agency, that China's share of electricity in terminal energy consumption has approached 30%, while the United States and the European Union have remained around 22% in recent years. This means that China's level of electrification has clearly surpassed that of the United States and the EU, "China may become the first major electrified country in the world."
RMI study shows that China's electrification rate has already led that of the United States and the EU - screenshot from The Financial Times
Bloomberg News analysis stated that most Asian countries are importers of fossil fuels, so promoting electrification and renewable energy development has become a top priority for these countries economically. As the world's largest producer of oil and natural gas, the United States has not taken the same incentives.
However, with the development of artificial intelligence technology, the power demand of data centers is rising sharply, and the U.S. power supply is facing huge pressure. Factors such as equipment and personnel shortages and regulatory barriers make it difficult for the United States to build energy supply.
Bloomberg News pointed out that Trump's "big and beautiful" bill plans to cancel subsidies for new energy projects such as wind and solar power. Some senators' amendment proposals also attempt to target new energy projects using Chinese components, which could hinder the U.S. electrification process and even lead to the United States being unable to meet the growing demand for electricity.
Walter believes that lagging electrification will cause developed countries to miss opportunities. "Renewable energy can lower power costs. Electrification upgrades the technologies that people depend on daily - such as cars, heating, and control systems, and brings savings," he said.
American billionaire Musk also warned on social media platform X on June 29: "We are making a huge strategic mistake right now, destroying solar power and batteries will make the United States extremely vulnerable in the future." Musk said that if Trump's "big and beautiful" bill is implemented, it will "destroy millions of jobs in the United States."
The U.S. House of Representatives had already passed the "big and beautiful" bill in May, but the vote opened by the Senate on June 30 has turned into a "battle." According to ABC News, as of now, the voting on the amendments proposed by the senators has lasted nearly 24 hours, but whether the bill can pass the Senate is still unknown.
The report said that the Senate has fallen into a "paralyzed" state, and Senate Republican Leader John Thune is pressuring Republican senators who oppose the bill, trying to secure the simple majority support needed to pass the bill.
Trump previously set a deadline for the "big and beautiful" bill, requiring the bill to be passed before the U.S. Independence Day on July 4th. However, Trump told ABC News on July 1st that he was willing to delay the deadline to ensure the bill passes in Congress. He said, "I really want to finish it on July 4th, but I think it's hard to finish on July 4th."
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