Kathy Castor, a representative from Florida who led the project, told me that instead of a platform, I should think of the project as “a workable plan for long term economic and job growth.”
“We’re not introducing a bill after this,” she said. “We’re providing it to policymakers in Washington for them to build the bipartisan support you need to get something across the finish line. The Trump administration is going to be there for two more years. What can we get done now that would have bipartisan support?”
Nevertheless, this is still the most sweeping environment and energy policy document Democrats have published since 2020, when the House Select Committee on the Climate Crisis — which Castor also chaired — published a nearly 550-page plan to “solve the climate crisis.” Much of that work became a part of the 2021 bipartisan infrastructure law and the 2022 Inflation Reduction Act. Of course, significant chunks of those laws, including tax credits for wind and solar projects, were later dismantled by the Trump administration in the One Big Beautiful Bill Act.
The Climate Crisis Committee disbanded in 2023, but the Thriving Economy Project is, in some ways, a continuation of its work. The document itself is the product of an independent nonprofit, which Democrats from the Sustainable Energy and Environment Coalition enlisted to probe experts, local leaders, companies, and advocates around the country for ideas about what Congress should do to create jobs, lower energy costs, foster innovation, and shore up communities. The nonprofit, known as the Sustainable Energy and Environment Coalition Institute, convened working groups, roundtables, and listening sessions. It also issued a public Request for Information that generated more than 1,300 policy recommendations from around 150 responders, including businesses and trade associations, local governments, nonprofits, and universities, the report said, and assembled a “20-person steering committee of ideologically diverse experts” to challenge its own assumptions.
The resulting report asserts that it is “not a consensus document, nor was it ever intended to be. It is a menu of ideas that have been challenged, refined, and improved by people approaching the same problems from very different perspectives.”
Perhaps that’s why the document reads a little bit like throwing spaghetti at the wall. There’s plenty in it that could conceivably be bipartisan, but there’s also a lot that stands no chance of passing under Trump, even if Democrats take the House and Senate in November’s midterm elections. In that light, it’s both a menu for the next two years and a window into how Democrats are generally thinking about climate policy in the post-IRA era. Here are five of my takeaways after going through it.
1. Some of the IRA is worth reviving … but not the wind and solar tax credits.
The authors do not spill any digital ink lamenting Trump’s dismantling of the IRA. They do, however, propose restoring a bunch of what’s been lost and building on the lessons learned from the brief time the policies were in effect.
For example, the report suggests reinstating federal tax credits for home energy efficiency improvements and residential clean energy systems such as rooftop solar, but recommends offering the credits as a point-of-sale rebate rather than a return claimed on the buyer’s taxes. That would be similar to the way electric vehicle buyers could transfer their tax credit to the dealer to get the discount on their purchase immediately. The goal, according to the report, is to “minimize the upfront costs and administrative frictions for consumer-facing incentives.”
Speaking of the electric vehicle tax credit, bringing it back is also on the menu, justified as a demand pull to support domestic supply chains and as a complement to the manufacturing tax credits, which largely survived the IRA purge (more on that below). Interestingly, a separate section of the report proposes a perhaps more politically palatable consumer rebate for new vehicles based on fuel efficiency rather than a strict EV-only subsidy, framing the idea as an option to address “unaffordable gasoline.”
There is a meaty section on extending and expanding the manufacturing tax credits, which, as you may remember, will no longer apply to wind turbine components after 2027, thanks to Trump’s One Big Beautiful Bill Act. The report suggests cancelling that early termination. It also proposes extending the subsidy to a long list of additional advanced energy technologies, including power transformers, industrial heat pumps, and long duration energy storage components. Additionally, there are several sections on improving federal support for early-stage technologies, helping them get through the “valley of death” to commercial deployment — a major theme in both the bipartisan infrastructure law and IRA.
Notably absent is any discussion of reinstating the tax credits for wind and solar generation. When I asked Castor about that, she said “a lot of that ground had been plowed already,” referring to the contentious battle over the credits during the OBBBA negotiations. “In this Congress, that’s not going to happen. This effort is driven by solving problems ASAP where we think there can be bipartisan support going forward.”
2. Congress could get more wonky about energy markets and transmission
The report intentionally stays away from one of the most significant ways Congress could speed up solutions to address rising energy demand: permitting reform. A disclaimer at the top notes that since Congress was actively debating legislation on that issue while the report was being written, the authors chose not to tackle it directly.
It does, however, spend plenty of time working around the edges on ways to clear up clogged interconnection queues and fix bottlenecks to getting more transmission online. For one, it suggests more funding for the Department of Energy’s Transmission Facilitation Program, which allows the agency to temporarily serve as an anchor customer for new transmission lines. Creating a 30% investment tax credit for transmission lines is another idea in the report.
A lot of the recommendations revolve around improving grid planning and integrating grid-enhancing technologies, advanced conductors, and energy storage into the process. The report suggests establishing a national transmission conductor standard, for example, setting a minimum efficiency level for the wires strung along transmission lines to reduce waste.
Beyond transmission, there are a slew of ideas for reforming energy markets to better support demand response and virtual power plants. Congress could create federal guidance for how grid operators and state regulators assess the value of energy storage to the grid, and direct the DOE to provide more technical assistance to operators on incorporating flexible resources that can shift load, relieve congestion, and integrate more renewables into the grid.
3. Trump-proof future policies will be difficult
One of the biggest challenges Democrats will have to contend with is writing policy that can endure past a change in party control. Trump has found myriad ways to block projects approved by the previous administration and withhold congressionally mandated funding. The courts are still deciding whether his administration’s methods are actually legal. Nonetheless, the report reflects an interest in creating more certainty for federal grantees and restoring trust in the federal government as a funding partner.
For one, it explicitly recommends that Congress restore awards that were legally obligated under IRA programs such as the Greenhouse Gas Reduction Fund, the Environmental and Climate Justice Block Grants, the Community Change Grants, and the Neighborhood Access and Equity Grants that the Trump administration has attempted to terminate — though it stops short of specifying how.
In the future, though, it recommends that federal funding be funneled through “trusted third-party fiscal intermediaries to allow for nimbler program management and structural insulation from political shifts.” Congress should also more narrowly define the circumstances under which an award can be terminated, it says, offering the suggested language: “funds awarded under [identified programs] may not be rescinded, reprogrammed, or deferred except by law.”
In cases where an administration does rescind or terminate funding, it recommends that Congress put in law that any legal challenge to the termination belongs in the U.S. District Courts. The Department of Justice is attempting to argue that the disputes over Trump’s grant terminations constitute breach of contract claims, and therefore belong in the court of federal claims. If the cases end up there, however, the grantees will only be able to sue for damages — they won’t be eligible to get their grants reinstated. A provision explicitly placing these cases in the district court would ensure awardees have a path to actually contributing to congressionally-mandated goals.
While these provisions are promising, however, it’s hard to imagine that Trump would sign off on them.
4. Data center electricity demand is a central organizing problem for policymakers.
One of the most obvious differences between the world we live in now and the world lawmakers occupied in 2020 is that the race for artificial intelligence is in full swing, driving a surge in electricity demand the country has not seen in decades. Data centers have become the locus of a number of intersecting issues — permitting obstacles for energy infrastructure, rising electricity costs, local opposition to anything getting built at all, fear of AI, and concerns about cybersecurity.
The Thriving Economy Project treats data centers as a central organizing problem across several of its chapters. It offers policies to address environmental concerns such as requiring data centers to use closed-loop cooling systems to reduce water use. It proposes unifying the piecemeal approach states are taking to meet data center electricity demand under a federal standard that would require large loads to pay the full cost of connecting to the grid.
There’s a whole section on the challenges of meeting data centers’ power needs that contains more than two dozen policy ideas. A few that stand out include mandatory energy and water use disclosure requirements, a federal Energy Star-equivalent for AI tools, and the creation of a “U.S. Electron Accelerator.” That last idea is one of the most interesting proposals I came across. Data centers would pay into a fund for every kilowatt-hour of their demand not met with clean electrons generated at the same time and in the same location. The funds would then be available to help data centers cover the premium for procuring round-the-clock clean electricity from nuclear and geothermal plants.
Similarly, the report suggests requiring data centers to pay into a fund to support the Low Income Home Energy Assistance Program and the Weatherization Assistance Program, two perennially underfunded federal programs that help Americans who are struggling to pay their energy bills.
It also raises the concern that data centers powered by behind-the-meter natural gas plants will drive up the price of natural gas for other customers, thereby increasing home heating and residential electricity bills. The report suggests several ideas to reduce natural gas price volatility, including taxing oil and gas companies to create a “strategic energy affordability reserve.” If the president declares an “energy affordability emergency,” it says, the funds can be released to states to help residents pay their bills. Additionally, Congress could create an “energy price safety valve” to temporarily ban exports of key fuels when prices spike.
5. Risk and adaption are the new watchwords
A lot of the Thriving Economy Project reads like a manual for playing defense in an increasingly dangerous world. It is consumed with addressing risk — the risk of cybersecurity attacks on our electric grid, water systems, and airports, and of global supply shocks that throttle domestic energy prices and supply chains. While discussion of “climate change” as a problem to tackle is notably absent from the report, a rhetorical shift I wrote more about here, adapting to the realities of a warming planet is one of its main preoccupations.
It suggests establishing a federal climate relocation program, for example, and setting federal climate-adapted transportation standards, such as elevation in flood zones and transit facility shading. There’s a recommendation to build a “national climate-health early warning system” to alert people about extreme heat, wildfire smoke, vector-borne diseases, and harmful algal blooms. Along those lines, it suggests that severe wildfire smoke events qualify for federal disaster assistance. At the same time, federal disaster assistance is too fragmented across various agencies, it says, and the government could establish a single, mobile-friendly app “as the front door to all federal individual disaster aid.”
It recommends creating an independent National Disaster Safety Board, an independent watchdog to investigate deaths and damages after a disaster and issue recommendations for how governments at all levels can prevent these losses the next time. Congress could also establish a national climate risk disclosure standard for the real estate industry, giving homebuyers access to more consistent, transparent data about property risks.
These are just a few of many dozens of proposals to improve federal leadership on this especially local, disjointed issue.
IEA Electricity 2024 report
