The Inflation Reduction Act (IRA) is subsidizing renewable energy projects through hundreds of billions in loans and tax breaks. There’s only one problem: the power grid already can’t accommodate the number of wind and solar projects waiting to be hooked up. More taxpayer-sponsored wind turbines and solar panels won’t be of much use in replacing fossil fuels or adding generating capacity if they can’t deliver power to consumers.

Projects must apply for interconnection so utilities can plan for the cost of grid upgrades and new equipment. For wind turbines and solar fields, developers and utilities must often embark on expensive upgrades to add more long-distance, high-capacity transmission lines and substations to deliver power to where it is needed. 

As of the end of 2022, more than 1,300 gigawatts of wind and solar projects are already seeking connection to the grid. To put that into context: CNBC reports that the current installed capacity of the grid is only 1,250 gigawatts. The projects currently waiting to be connected would generate more power than currently exists in the grid.

The IRA’s tax incentives and loan programs are likely to lengthen wait times. Renewable projects by nature generate less power and so it takes more of them—“six, seven, eight, nine, 10 different projects”—to add the same amount of energy to the grid as a single natural gas project.

Overwhelmed utilities are leaving households holding the bag for solar installations that have to wait months to connect to the grid. A resident near Morrison, Colorado, told a local reporter in February that she had been waiting since September 2022 to get her $30,000 solar panels connected to the grid. It will be awfully hard to meet the Biden administration’s goal to increase community solar deployment by 700% in 2025 if homeowners can’t offset the costs of installation by generating electricity.

Commercial wind and solar projects aren’t faring better. A recent report by the Lawrence Berkeley National Laboratory found that only 20% of wind and 14% of solar projects requesting interconnection between 2000-2017 were completed as of 2022. Wait times have ballooned as well: “The typical project built in 2022 took 5 years from the interconnection request to commercial operations, compared to 3 years in 2015 and <2 years in 2008.” 

Despite ample tax incentives in effect under the IRA—which has been predicted to cost three times more than the Treasury’s initial $270 billion estimate—American Electric Power plans to sell off its unregulated renewables portfolio for $1.5 billion by the end of July. The move is an attempt to “de-risk.” Who could have guessed that renewable energy was a risky business, despite guaranteed subsidies and promised market share from the current administration?

When only one in five energy projects successfully runs the gauntlet to connect to the grid, there’s a problem. The IRA’s uncapped tax incentives are likely to significantly overrun government cost estimates, but if it does succeed in increasing the number of wind and solar power projects, it will only be adding to interconnection backups.