Trump says he’ll claw back unspent money from the IRA. That may not be easy.
Among the many promises President-elect Donald Trump laid out on the campaign trail: clawing back unspent Inflation Reduction Act funds. That’s the bill signed by President Joe Biden in 2022 that’s poured billions of dollars into the clean energy sector. It won’t be an easy promise to keep, though.
In the last two years, the IRA has spurred a boom in domestic clean energy manufacturing, according to Bob Keefe, head of the group Environmental Entrepreneurs.
“We’re talking about solar panel factories, electric vehicle factories, battery factories, hydrogen hubs now,” lots of solar and wind power plants, he said.
Billions of dollars have been spent, leading to billions more in private investment, Keefe noted. And this development is happening “mainly in Republican states, Republican congressional districts.”
That’s largely because red states have fewer regulations around siting and building the kinds of projects the IRA targets, said David Victor, a professor of innovation and public policy at UC San Diego. And, he added, red states have benefited because the IRA’s climate provisions were aimed at changing the politics around clean energy projects.
“You take folks that previously might have been opposed to these kinds of projects and make them supportive, because those projects are happening in their districts,” Victor said.
There are signs that’s been effective: Back in August, 18 Republican members of Congress sent a letter to House Speaker Mike Johnson urging him not to mess with the clean energy tax credits funded through the IRA.
Victor expects that kind of pressure from Congresspeople who’ve seen the IRA benefit their districts, will help keep some of the law’s policies in place.
“They won’t call them ‘climate change policies,'” he said. “They’ll call them ‘jobs policies’ and ‘American growth policies’ and ‘economic reinvigoration.'”
Whether or not IRA funding is pulled back, the economics of renewables have changed since Trump was last in office, per Joshua Rhodes, a research scientist at UT Austin.
“One of the things that I am pretty certain about making a forecast for is we’re going to use more electricity, not less. And renewables are generally the cheapest form of new electricity to build,” he said.
So, the industry could very well keep growing on its own. But some policymakers had hoped to boost it even further with a second IRA-type bill in the coming years, pointed out Sanya Carley, a professor of energy policy and city planning at the University of Pennsylvania.
“There are plenty of climate advocates and others who have been working on policy proposals and thinking deeply about what this might look like,” she said.
Now, Carley added, those ideas are probably dead in the water.
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