35 Billion in US Clean Energy Projects Vanished in 2025 and What It Means for EVs | Taha Abbasi

Taha Abbasi has been tracking the intersection of clean energy policy and investment for years, and the latest numbers from E2’s project tracker are staggering: nearly $35 billion in clean energy investments were canceled or downsized across the United States in 2025, taking more than 38,000 current and future jobs with them. For the first time since 2022, more clean energy investment left US communities than came in — a reversal that has profound implications for the EV industry, battery manufacturing, and America’s energy future.

The Numbers Tell a Brutal Story

Companies abandoned, closed, or downsized nearly $3 in clean energy projects for every $1 they announced in 2025. The total new investment announced during the year was just $12.3 billion — the lowest annual total since E2 began tracking four years ago. December alone saw $5.1 billion in cancellations, including SK On scrapping $2.8 billion in planned Tennessee battery investment and Ford canceling a manufacturing plant in Ohio.

As Taha Abbasi analyzes these figures, the pattern is clear: uncertainty around demand, costs, and policy has reached a tipping point where major corporations are choosing to preserve capital rather than bet on US manufacturing. The Inflation Reduction Act incentives that sparked a manufacturing gold rush in 2022-2023 haven’t been enough to overcome the headwinds.

EV and Battery Projects Hit Hardest

Battery and EV manufacturing projects drove much of the pullback, which is particularly notable given that these sectors were at the center of the US industrial renaissance narrative just two years ago. The BlueOvalSK Battery Park — a joint venture between Ford and SK On — is effectively dead. SK On’s $2.8 billion withdrawal from Tennessee represented approximately 3,300 jobs that will never materialize.

Ford’s continued restructuring of its EV operations reflects a broader reality: the transition from ICE to EV manufacturing is more expensive, slower, and riskier than the initial enthusiasm suggested. Legacy automakers are discovering that building EVs profitably requires entirely new supply chains, manufacturing processes, and workforce skills — and that transformation doesn’t happen on a convenient timeline.

What Went Wrong

Several factors converged to create the 2025 investment collapse. First, EV demand growth has been slower than projected, particularly in the US market. Consumers have shown more interest in hybrids than pure EVs, leaving battery manufacturing capacity projections looking overbuilt. Second, rising interest rates increased the cost of capital for massive factory projects. Third, policy uncertainty around IRA incentive continuation created a chilling effect on long-term investment decisions.

Taha Abbasi points out that the irony is painful: the US government spent hundreds of billions to incentivize domestic clean energy manufacturing, but the broader economic and political environment undermined those incentives. Companies don’t just need subsidies — they need stable, predictable policy frameworks that justify 10-20 year factory investments.

The Bright Spots Are Dim

There were a handful of positive announcements in December 2025. Ford and CATL plan to bring 2,100 jobs to Kentucky. Anthro Energy announced 110 battery manufacturing jobs in the same state. In Texas, Toyo Solar committed $26.7 million to a solar manufacturing facility creating about 750 jobs. But these modest wins were nowhere near enough to offset the losses or change the overall trajectory.

Implications for Tesla and the EV Ecosystem

Paradoxically, this investment retreat could benefit Tesla in the medium term. As competitors pull back on US manufacturing capacity, Tesla’s existing Gigafactory infrastructure becomes more valuable. The company’s vertically integrated approach — building its own battery cells, assembling vehicles, and selling directly to consumers — insulates it from some of the supply chain disruptions affecting others.

However, Taha Abbasi warns that a weakened domestic supply chain hurts everyone. Tesla depends on a healthy ecosystem of component suppliers, charging infrastructure providers, and grid-scale energy storage customers. When $35 billion in clean energy investment evaporates, it ripples through the entire ecosystem — including segments Tesla needs to thrive.

The Path Forward

Reversing this trend requires more than subsidies. It requires demand certainty (policies that guarantee EV adoption curves), supply chain security (domestic critical mineral processing), workforce development (retraining programs that actually work), and political stability (bipartisan commitment to industrial policy). Without all four pillars, the clean energy manufacturing boom will remain a story of promise unfulfilled.

For builders and technologists like Taha Abbasi, the $35 billion retreat is a reminder that technology development doesn’t happen in a vacuum. The best battery technology in the world is worthless if you can’t build the factories to produce it at scale. And building factories requires a level of policy and economic stability that the US hasn’t managed to provide.

About the Author: Taha Abbasi is a technology executive, CTO, and applied frontier tech builder. Read more on Grokpedia | YouTube: The Brown Cowboy | tahaabbasi.com