OBBBA Shifting Generation Interconnection Queues in the U.S.

Over the past year, the United States has experienced considerable market uncertainty as participants attempt to navigate the current energy regulatory environment. The current administration has expressed dissatisfaction with the recent trend of power developments, particularly those involving intermittent sources, like wind and solar. The One Big Beautiful Bill Act (OBBBA) alleviated some short-term uncertainty, but it contrasts sharply with the Inflation Reduction Act (IRA) and has resulted in lower forecasted renewable buildout. The volatile nature of the American energy sector and the potential impacts of the OBBBA are likely to affect the U.S. generation queue, but the question remains: to what extent?

When we observe additions to the generation interconnection queue over the past eight years, the effects of public policy and financing are very clear. Focusing on the most common fuel types entering the queue (natural gas, wind, battery, and solar), the influence of the Biden administration and the implementation of the IRA becomes apparent. After the Biden administration took office in 2021, applications for these generation sources surged by over 50%, followed by another boost of approximately 20% with the passage of the IRA. However, queue applications began to slowly decline following these initial spikes, though they remained above pre-Biden administration levels until this year.

Beyond the sheer volume of projects entering the queue, the progression of power plant development across different fuel sources offers additional insights into the impact of recent policy changes. To assess this progression, we examined three distinct time periods:

1. Pre-Election: The year prior to President Trump’s election (366 days).
2. Post-Election: President Trump’s Election, November 5, 2025, to the passing of the OBBBA, July 4, 2025 (241 days).
3. Post-OBBBA: The passing of the OBBBA to the latest available data, November 14, 2025 (133 days).

Analyzing these intervals reveals a notable trend: project advancement within the queue has largely stagnated since the OBBBA was passed. However, while projects have ceased to move forward, they have also avoided regulatory setbacks or cancellations. Though differences in timeframe length could distort the scale of this trend, the stagnation remains evident even when progress is normalized to megawatts moved per day. This pattern is likely driven by developers racing to complete projects ahead of anticipated new regulations, and it is expected that a similar rush will occur as developers aim to commence construction before July 4, 2026, one of the OBBBA’s funding deadlines. As this date approaches, we will likely see a wave of decisions, with companies either canceling or committing to their projects.

Looking ahead, it’s likely that developers will concentrate their efforts on initiating construction for as many projects as possible before the July-4^th deadline to remain eligible for funding. This may push in-service dates (ISDs) further into the future for those developers with multiple projects in development, as getting intermittent generation projects to construction will likely take priority over project completion, but more projects will likely reach commercial operation in the following months.

Using ERCOT as an example, a sample of advanced projects in the ISO’s generation queue shows that current ISDs are being projected further into the future than has been customary in recent years. However, ISDs are projected to accelerate as the end of 2027 draws closer and developers attempt to maintain their tax-credit advantage by meeting the 12/31/2027 cutoff date for non-safe harbored projects, as mentioned in our analysis of the OBBBA (available to FactSet Workstation users).

Though not yet a year into a new administration with new policies, we have already seen the U.S. energy sector shift in response to the new incentive structures being put in place. The ultimate success of projects in the queue will depend on developers’ ability to plan effectively, adapt to the evolving regulatory environment, and maintain reliable access to materials. Recent trends suggest a continuing move away from intermittent generation sources across the U.S. over the next several years. In the coming months, developers are expected to resume both committing to projects as they move towards construction and canceling those that have become unfeasible under the new policy landscape.

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