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On half-full glasses, Omani polysilicon, and U.S. vs. Chinese nuclear
Any version of the future — even one under Trump — includes bits of the Inflation Reduction Act.
On energy inefficiency, global green H2, and New Hampshire’s guerrilla solar
A just-released MIT paper argues that the energy transition is still largely following the trajectory laid out in the Inflation Reduction Act.
And data centers might be collateral damage.
Plus, a look into the future of solar and wind tax credits.
And not for the first time.
The Department of Energy proposed sweeping changes to its rules for updating efficiency standards for household appliances on Thursday. If finalized, they would hamstring future administrations from issuing tighter standards that would save consumers money as higher-performing air conditioners, stoves, washing machines, refrigerators, and the like hit the market.
While the agency portrayed the move as bringing an end to appliance standards writ large, that is not, in fact, what it is doing. The proposal would update the DOE’s so-called “Process Rule,” which governs how the agency develops standards, adding onerous requirements that will make it much more difficult to make any changes at all.
Under the Energy Policy and Conservation Act, the DOE is generally required to review existing standards every six years and assess whether recent technological advances warrant raising the bar for efficiency for any given product category. Updating the standards involves extensive technological and economic analysis, including looking at the cost to manufacturers and payback periods for consumers, as well as several rounds of public comment. After a new standard is issued, products that fail to meet that level of efficiency have to be taken off the market.
The new proposal delivers on the appliance industry’s request that President Trump restore the process he finalized during his first term, which Biden swiftly reversed. The changes include raising the minimum energy savings required to issue a new standard, adding several more steps and requirements to the rulemaking process for new standards, and using industry-developed test procedures to measure the efficiency of new products.
“This obstacle course of restrictions would hinder the department from carrying out its congressional mandate to protect consumers,” Andrew deLaski, executive director of the Appliance Standards Awareness Project, said in a statement. “We have products that keep getting more efficient and we need to embrace these technological advances, not reject them, especially as data centers strain our electric grid.”
Manufacturers welcomed the announcement. “AHAM applauds the Department of Energy for acting swiftly and delivering a proposed Process Rule that reflects years of constructive engagement with manufacturers, consumers, and other stakeholders,” Kelly Mariotti, the Association of Home Appliance Manufacturers’ president and CEO, said in a statement. The Air-Conditioning, Heating, and Refrigeration Institute also told me it “strongly supports DOE’s review” of the rules, although both groups said they were still working through the proposal.
The Energy Department issued a request for information last April seeking comments on potential changes to its procedures for revising energy conservation standards. At the time, the industry’s biggest trade groups urged the agency to “return to the 2020 version of the Process Rule.”
Trump has long been sympathetic to the industry’s ire over ever-tightening standards. He’s complained about dishwashers and heating systems that no longer work and showers that slow to a trickle. Now, Energy Secretary Chris Wright has joined in, grumbling about clothes dryers that run for multiple cycles.
The Process Rule changes threaten the potential to create significant consumer savings, however, according to the Appliance Standards Awareness Project. The group estimates that based on recent technological advances, the DOE’s next round of standard updates could save the average U.S. household $160 per year on their utility bills, and businesses a collective $15 billion in annual operating costs over 20 years. The group also projects that updated standards have the potential to reduce summer peak electricity demand 34 gigawatts by 2040, which would be like taking New York City off the grid. There are climate benefits, too, of course — an estimated reduction of 800 million metric tons of carbon emissions through 2050.
Even if finalized, Trump’s changes to the Process Rule will not be irreversible, and could continue to ping pong back and forth between administrations, “creating the kind of uncertainty and instability that makes it difficult for manufacturers to plan, invest, and innovate with confidence to the benefit of American consumers,” according to Mariotti of AHAM. The industry’s hope is for Congress to amend the underlying Energy Policy and Conservation act to “lock these reforms into statute,” she said. One such effort, the Don’t Mess With My Home Appliances Act introduced by Republican Representative Rick Allen of Georgia, passed the House in February.
The DOE’s proposal follows a memorandum of agreement the agency reached with the Environmental Protection Agency in March to take over as the lead agency running the EnergyStar labeling program, which identifies the most efficient appliances in a given category. The Process Rule changes will not affect EnergyStar, however.
The DOE is accepting public comments on its proposal for 30 days and will hold a public meeting on July 15.
Democrats in Congress are determined to restore them. That isn’t necessarily what the industry wants.
As many Americans celebrate the country’s 250th birthday this weekend, the clean energy industry will be mourning a death. Independence Day marks the expiration of federal tax credits for wind farms and solar arrays, subsidies that have been in effect in some form or another since 1978.
They may not be dead forever. Leading Democrats in Congress are preparing to reinstate the tax credits the next chance they get — whether or not the clean energy industry is asking for it.
“Republicans letting these clean energy credits expire is bad for families, bad for workers, and a gift to China,” Senate Minority Leader Chuck Schumer told me in an email. “Democrats will fight to bring these incentives back and keep pushing every policy that lowers energy costs, strengthens American manufacturing, and protects America’s clean energy future.”
While the tax credits were not initially created to tackle climate change, they became the backbone of American climate policy as fossil fuel companies mired federal attempts to regulate carbon pollution in court challenges.
The original credits, passed as part of the 1978 Energy Tax Act, were intended to reduce the country’s reliance on oil and natural gas during the oil crisis. They included a 30% tax credit for homeowners and a 10% tax credit for businesses on the cost of wind or solar, among other “alternative energy” technologies. Congress passed extensions of the credits numerous times in the decades that followed, making tweaks along the way: Lawmakers took away the credit for wind farms in the mid-1980s; then, in 1992, they created a new production tax credit for wind based on the amount of energy a given project generated.
Throughout the history of the tax credits, there was often a will-they-won’t-they precarity to their reauthorization. And yet in the end Congress always extended the credits on bipartisan votes. It wasn’t until the 2022 Inflation Reduction Act, which wrapped up tax credit reauthorization in a larger, highly partisan package, that even Republicans who supported the credits withdrew their votes in protest.
The IRA dramatically extended and expanded the subsidies, opening up both the investment and production tax credits to any carbon-free electricity source — not just wind and solar — and authorized them for as many years as it would take to cut emissions from the electric grid by 75%. It also offered developers increased tax relief, covering up to 70% of their costs if they used equipment from U.S. factories and built in designated low-income “energy communities.”
This combination of tweaks — the seemingly infinite timeline, the generous boost for domestic content — contributed to a boom in investment in new wind and solar projects in the U.S. and onshore manufacturing of the equipment to build them. But unbounded optimism gave way to uncertainty when Trump took office in early 2025 and pushed through the One Big Beautiful Bill Act, which cut short subsidies for wind and solar. Projects that begin construction on or after July 4 of this year must be up and running by the end of next year if they want to claim the tax credits — an absurdly short timeline — though other carbon-free energy sources such as new nuclear reactors, geothermal plants, and energy storage systems remain eligible until 2033.
The effects of the tax credit cliff for wind and solar will not be noticeable right away. Developers have stockpiled solar modules and turbine parts and ordered custom transformers, strategies that will enable them to claim they have “begun construction” on projects before July 4, even if they haven’t broken ground yet. Wood Mackenzie analysts estimate that companies have safe harbored between 216 gigawatts and 240 gigawatts of solar capacity, and nearly 30 gigawatts of onshore and offshore wind capacity. It will take four to five years for the industry to work through this pipeline. Any slowdown during that time is more likely to be a result of Trump’s gauntlet of permitting challenges for renewables or community opposition than it is to come back to the lack of tax credits.
Post-2030, however, the picture is murkier. No one I spoke to for this story expects clean energy development to come to a halt. Solar is the fastest growing energy source in the United States, and with demand for electricity surging, that’s unlikely to change. Without the tax credits, however, solar projects may become more difficult to finance, and the energy they generate will cost more. According to market research by LevelTen Energy, a company that connects corporate clean energy buyers and sellers, developers expect average prices for power purchase agreements, or PPAs, to rise by 40% to 120%.
That’s a wide range, and these numbers are still hypothetical, as developers aren’t yet selling power from non-tax credit-eligible projects, Connor Valaik, a senior manager for energy marketplace transactions at LevelTen, told me. When I asked him whether corporate buyers will still be interested at those rates, he noted that PPA prices have already increased year over year due to tariffs and inflation, “and we still see really strong demand for PPAs.” What matters most is the price of a solar or wind PPA relative to the market price of power. If electricity demand continues to explode in the 2030s, as it is expected to, “that will push energy market prices up, which could buoy that value to buyers.”
When I started asking whether the clean energy industry itself would fight to bring the tax credits back, the responses I got were mixed. The developers I reached out to declined to comment. The American Clean Power Association sent an ambiguous quote from JC Sandberg, its chief policy officer, stating that it was “focused on delivering durable policies to support American-made clean energy.” The Solar Energy Industries Association repeated an earlier quote from its president and CEO, Tim Pawlenty, stating that “SEIA will of course consider any policy, including tax credits, that accelerates solar and storage growth.”
One staffer in the House told me there’s a split between bigger developers that don’t need the tax credits for their projects to be viable and smaller companies that do, which is making it difficult for the trade associations to take a position. Another staffer told me that while they’ve heard some in the industry argue that it would be better not to put a target on their backs by reinstating the credits, that is not the majority view.
Maya Gibbs, a senior policy advisor for clean energy deployment at the center-left D.C. think tank Third Way, said the industry has bigger fish to fry right now. “There’s better bang for our buck, so to speak, in reducing the structural and non-cost barriers that are getting in the way of projects,” she told me. That includes speeding up permitting and building more transmission. Even if Democrats win a trifecta in 2028, she said, she’d caution against trying to reinstate the credits on another party-line vote.
The biggest lesson from the IRA was that “for legislation to be durable, it needs to be bipartisan,” she said, “and I don’t anticipate enough Republican support for wind and solar tax credits to get that across the finish line.”
There is one corner of the clean energy industry that’s been vocal about its concerns: solar manufacturers. The tax credits — and specifically the bonus they offered for using domestic content — generated demand for U.S.-produced technology to an extent that reshaped the American solar manufacturing landscape. The United States now has enough solar manufacturing capacity to meet domestic demand two times over, much of which was built in the past four years.
The caveat to that statistic: Those new factories mostly assemble the final solar modules. The parts still come from elsewhere, primarily China. Manufacturers have only just started to onshore the rest of the solar supply chain, with just a small handful of factories currently operating or in development to produce cells, ingots, wafers, polysilicon, and other subcomponents. Manufacturers like Qcells, which is building some of that upstream capacity at its factories in Georgia, argue that it’s crucial to national security to diversify the supply chain away from China.
“We see domestic content as probably the most critical tool to supporting the factories that we’re investing in,” Marta Stoepker, the head of corporate communications for Qcells, told me. “Not having direct access at home to that technology opens a myriad of vulnerabilities from an energy standpoint. Until we can actually catch up, we need policies that are really, really proactive and aggressive to onshore.”
Tax credits aren’t the only option. Protective trade policies like tariffs on imported modules and anti-dumping duties have also helped. And Stoepker and Martin Pochtaruk, the CEO of solar manufacturer Heliene, both suggested that permitting reform could be another potential vehicle to support domestic manufacturing, for example by offering faster approvals to projects that use U.S.-made equipment.
The problem with that idea, Gibbs told me, is that it means adding additional administrative complexity to a policy that’s supposed to remove red tape.
Everyone I spoke to agreed that in the near term, the most important thing Congress could do to help clean energy is break down some of the non-cost barriers to development through permitting reform. Some, like Gibbs, were optimistic that a package could come together by the end of the year. She argued that both parties have learned they can’t afford to wait for the perfect deal. “Every single year of inaction on permitting reform means that less new energy gets built, and that’s higher cost for consumers,” she said.
Representative Jared Huffman, the ranking member on the House Natural Resources Committee, was less sure. He told me that as long as the Trump administration continues to shut down clean energy projects, “I don’t think Democrats can engage in a serious way with Republicans on permitting reform.”
When I reached out to Democrats in Congress, I asked them whether they still saw a need for solar and wind incentives, whether tax credits were still their favored mechanism, or if there were other ideas being tossed around. The response was nearly unanimous — they told me they were determined to restore the tax credits. “Bottom line, the tax credits worked and the U.S. saw a clean energy boom like never before,” Senator Ron Wyden of Oregon, who serves as the ranking member of the Senate Finance Committee, told me in an email. “So we need to put that framework back in place.” The only departure from that narrative came from a Hill staffer who told me there was a general lack of imagination in the Democratic caucus about where energy policy and climate policy should go next, hence the focus on the tax credits.
While nobody thinks restoration will be possible under Trump, some in Congress are already preparing for the next opening. Two Democrats in the House, Sean Casten from Illinois and Mike Levin from California, introduced the Energy Bills Relief Act in March, which would reinstate the credits, among other policies to support energy affordability. In an interview, Representative Levin told me he thinks it’s become “one of the consensus House Democratic blueprints for energy affordability.” The tax credits are “a tried and true way to incentivize people to build clean energy, for consumers to invest in clean energy,” he said.
For Huffman, who supports Levin and Casten’s bill, the tax credits aren’t necessarily about helping wind and solar compete. The point is to get off of fossil fuels faster. “If you believe the science that we are in a race against time to avoid tipping points that could make this planet unlivable,” he told me, “then I think you lean towards a more aggressive policy of speeding up this transition, and that’s where I fall.”
Editor’s note: This story has been updated to reflect the abbreviated placed-in-service requirement for solar and wind projects that begin construction after July 4 of this year.
