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Here at DISC, we see the electrical distribution community ending 2024 at $141.4 billion for +2.3% overall year-over-year (YOY) growth. We see 2025 at $144.5 billion, up +2.2% over 2024. This is in line with historical norms and inflation. (The forward assumptions have not yet fully considered the impacts of potential tariffs, changes to existing legislation, and the effects of unrealized inflation). Looking ahead, for now, we see a robust growth year in 2026 fueled by hearty performance in both the construction and industrial verticals.
Now is the time to align resources and consider strategy. There is no doubt that the new Presidential Administration will have an impact on the electrical distribution industry. It’s important to consider this impact during our future planning. We can start to consider what changes may take place that will have a bearing on our forecasts and the overall direction of our industry.
The return of President Donald Trump will bring substantial changes to the Biden Administration’s green electrification initiatives. Given Trump’s past stance on energy and environmental policy, we can expect a shift back toward fossil fuels and a scaling down of current electrification, and be aware of the potential impact on renewable energy investments, electric vehicle (EV) subsidies, and infrastructure upgrades, as well as the broader climate goals set by the Biden Administration.
Under President Biden, the green electrification agenda was at the forefront of U.S. energy and environmental policy. Biden’s approach included substantial investments in clean energy, focusing on renewable resources such as wind and solar. The Bipartisan Infrastructure Law and the Inflation Reduction Act (IRA) were instrumental in securing funding for projects to bolster electrification, including building EV charging stations, incentivizing solar and wind energy adoption, and supporting research and development for newer and cleaner energy technologies, including energy storage and battery technology. Let us review some key pillars of the Biden plan.
Expansion of renewable energy. The Biden administration provided incentives and subsidies for renewable energy companies, aiming to double wind, solar, and battery storage capacities.
EV support. Biden set a target for EVs to comprise 50% of all new car sales by 2030. Substantial tax incentives were offered to both consumers and manufacturers to encourage EV adoption and domestic manufacturing. Even now, we have been seeing a decline in EV adoption.
Modernizing the grid. The Biden administration focused on upgrading, modernizing, and adding smarter systems to the U.S. energy grid to manage an increased load from renewable energy sources, data centers, and distributed power generation, improving efficiency and reliability.
Climate policy. The three initiatives above align with the U.S. commitments under the Paris Agreement, aiming to reduce greenhouse gas emissions by 50-52% below 2005 levels by 2030 and achieve net-zero emissions by 2050.
TRUMP ADMINISTRATION’S ANTICIPATED FOCUS ON ENERGY DOMINANCE INSTEAD OF RENEWABLE ENERGY
Trump’s previous term and campaign rhetoric will change the country’s stance on green electrification and renewable energy. His approach to energy will likely focus on “energy dominance” and a greater reliance on fossil fuels. Trump has consistently emphasized the importance of oil, coal and natural gas for U.S. energy independence. He also has expressed skepticism about the economic feasibility and reliability of renewable energy sources.
Trump’s prior administration reduced regulations on oil and gas, approved new pipelines and opened federal lands to fossil fuel exploration. His stance on fossil fuels aims to make the U.S. self-sufficient in energy, albeit with a heavy reliance on traditional sources. Under Trump, the federal government may reduce or remove the tax incentives currently in place for renewable energy projects, making it more challenging for solar and wind projects to remain competitive with oil and gas. He also may withdraw funding from renewable energy research and development.
Trump pulled the U.S. out of the Paris Agreement during his first term. If he returns to office, he could again remove the U.S. from international climate commitments, thereby signaling a diminished priority for reducing carbon emissions on a global scale. Given these perspectives, Trump would likely deprioritize the green electrification initiatives laid out by Biden, focusing instead on ramping up fossil fuel production and reducing government intervention in energy markets. Under Biden, renewable energy received unprecedented federal support. The new Trump administration will likely reduce funding and incentives, impacting the economic viability of new renewable projects. Projects reliant on federal grants and tax incentives may struggle to compete with established fossil fuel industries. The renewable sector has been a significant source of job creation in recent years. By scaling back support, the upcoming Trump administration might stifle innovation and job growth in clean energy industries, potentially impacting local economies. If renewable energy costs continue to decline, market forces could maintain some momentum regardless of federal policy. Private investments in renewables and electrification, driven by consumer demand and corporate sustainability goals, may encourage progress even without federal support.
WILL FEDERAL SUPPORT FOR EVS STALL?
The Biden Administration set aggressive goals for EV adoption, supported by tax credits for consumers and incentives for automakers. Trump’s approach, however, will likely mean a reduction in these incentives. The Trump administration might cut tax credits for EV buyers, making EVs less accessible to the average consumer and reducing the demand for EVs overall. Such a move would certainly impede progress toward Biden’s goal of 50% EV sales by 2030. Under Biden, billions of dollars have been allocated for building EV charging stations across the country. A rollback in funding will slow the expansion of charging networks, making it harder for EV owners to charge their vehicles on long trips and in rural areas. The Biden administration has emphasized incentives for automakers to build EVs in the U.S. to strengthen domestic manufacturing. A reversal of these policies will lead to fewer incentives for companies to produce EVs domestically, affecting American manufacturing jobs and new plant construction.
QUESTIONS ON CONTINUED SUPPORT FOR ELECTRICAL GRID MODERNIZATION
Biden’s plan for energy grid upgrades includes initiatives to improve grid reliability, enable integration of renewable resources, and support electrification. The change in administration could mean reduced funding and support for these upgrades. Under Trump, grid modernization efforts may lose federal support, causing delays in projects critical for increasing renewable energy capacity and managing peak demands more effectively. Without investment in a resilient energy grid, the U.S. may become more susceptible to disruptions from extreme weather events, which are projected to increase in frequency due to climate change.
A MOVE AWAY FROM AGREEMENTS ON INTERNATIONAL CLIMATE POLICY?
Biden’s commitment to the Paris Agreement has been central to his climate policy. Trump, however, has expressed the opinion that climate accords hinder U.S. economic interests. A withdrawal from the Paris Agreement would signal a departure from the international efforts to combat climate change, potentially weakening global climate action as other countries follow suit. Reversing this momentum toward emission reduction would jeopardize the previous U.S. goal of reaching net-zero emissions by 2050.
Without federal leadership, state-level initiatives would have to fill the gap, leading to an underfunded, inconsistent and fragmented approach to addressing climate change. Despite likely changes to Biden’s electrification agenda, some bipartisan support for energy independence and infrastructure modernization may remain. Trump has occasionally shown support for infrastructure development, which could include grid upgrades for energy reliability and security. Many states, particularly California and those in the Northeast, have their own ambitious climate and electrification goals. These states might continue to push for green initiatives independently of federal policies, creating a patchwork approach to green electrification across the U.S.
The Trump administration will likely bring significant changes to current green electrification initiatives, favoring fossil fuels and scaling back incentives for renewables, EVs and grid modernization. However, while federal support may wane, state policies and market trends could sustain some aspects of green electrification. In the long term, balancing economic growth with sustainable energy sources will be critical, and the electrical industry will likely continue to face challenges and opportunities as it navigates the transition toward a more sustainable energy future.
Christian Sokoll is president of DISC Corp., Houston, the electrical market’s leading provider of sales forecasts and related market data. He can be reached at [email protected].