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Policy Watch

The IRA’s Coming China Change

And more of the week’s biggest news around renewable energy policy.

Trump.
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Sourcing requirements – As we explain in our Q&A today, there’s momentum building in Washington, D.C., to attach new sourcing requirements to an IRA credit for advanced manufacturing known as 45X.

  • 45X is supposed to supercharge production of battery and solar components, as well as key minerals and materials for those components that are largely imported from China or what U.S. trade officials believe are Chinese pass-throughs.
  • Some U.S. companies are now quietly urging Congress to enact a “foreign entity of concern” requirement to 45X that would essentially stop battery and solar manufacturing plants with Chinese business involvement from qualifying.
  • Why? Well, doing this would definitely insulate the credit from GOP repeal by tying it not to rapid decarbonization but instead American blue collar jobs.
  • Patrick Donnelly, chief commercial officer for Anovion, told attendees of a Hill briefing I moderated earlier this week that he wants to see this happen because it would be a “game changer” for domestic manufacturing. “I’ve heard some Republicans talking about it already.”
  • But it could also undermine the effectiveness of the credit for climate purposes. Similar requirements were tacked onto the IRA’s EV consumer credit that curtailed its reach and meant many cars couldn’t access the benefit.

Virginia’s planning – The state of Virginia is looking at its own plans to override local objections, which would make it one of the few GOP-led states to do so.

  • The state’s commission on electricity regulation proposed a draft plan late last month that would enable companies to appeal local rejections. Under that plan, the state would create a siting advisory board that would give insights as to whether a rejection was contrary to the overall state’s power needs.
  • It’s not a sure shot. The commission acknowledged legislation will be necessary to make this plan a reality, and the state’s divided government has rarely found agreement with energy policies. But all those Virginia data centers are going to need power from somewhere.

Here’s what else we’re watching…

  • So much money is going out the door right now: In the last week, the Energy Department has announced billions in new conditional loan commitments. Good news for the Grain Belt Express transmission line!
  • Included in those funds – a gusher of offshore wind research money.
  • Environmental justice advocates worry there’ll be less of a rush to award money they won in the Inflation Reduction Act before Trump takes office.

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Spotlight

The Blast Radius of Interior’s Anti-Renewables Order Could Be Huge

Solar and wind projects will take the most heat, but the document leaves open the possibility for damage to spread far and wide.

Wetlands, Donald Trump, and solar panels.
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It’s still too soon to know just how damaging the Interior Department’s political review process for renewables permits will be. But my reporting shows there’s no scenario where the blast radius doesn’t hit dozens of projects at least — and it could take down countless more.

Last week, Interior released a memo that I was first to report would stymie permits for renewable energy projects on and off of federal lands by grinding to a halt everything from all rights-of-way decisions to wildlife permits and tribal consultations. At minimum, those actions will need to be vetted on a project-by-project basis by Interior Secretary Doug Burgum and the office of the Interior deputy secretary — a new, still largely undefined process that could tie up final agency actions in red tape and delay.

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Hotspots

Idaho’s Lava Ridge Wind Farm Faces a New Fight in Congress

We’re looking at battles brewing in New York and Ohio, plus there’s a bit of good news in Virginia.

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1. Idaho — The LS Power Lava Ridge wind farm is now facing a fresh assault, this time from Congress — and the Trump team now seems to want a nuclear plant there instead.

  • House Republicans this week advanced an Interior Department appropriations bill that would indefinitely halt federal funding for any permits related to the proposed wind facility “unless and until” the president reviews all of its permits issued under the Biden administration. Biden had completed permitting right before Trump took office.
  • Trump had already ordered a stop to construction on the project as part of a Day 1 flurry of executive orders. But if this policy rider becomes law, it could effectively handcuff any future president after Trump from allowing Lava Ridge to move forward.
  • While Democrats tend to view riders like these unfavorably and attempt to get rid of them, government funding packages require 60 votes in the Senate to break a filibuster, which often means partisan policies from funding bills passed by previous Congresses are challenging to get rid of and can stick around for long stretches of time.
  • By that same logic, one would assume that the need to hit that 60 number now requires Democrats, so wouldn’t they need them and want to ditch this rider? Except one thing: it is exceedingly likely given past congressional fights that the party’s right flank in the House requests fresh concessions. Policy riders like these become chits in that negotiation – and I do expect this one to be an easy sop for this flank given the executive order is already in place.
  • There’s also the whole matter of whether LS Power will try to proceed with this project under a future president amidst increasing pressure on the company. That’s likely why Sawtooth Energy, an energy developer interested in building new small modular nuclear reactors, is now eyeing the project site.

2. Suffolk County, New York — A massive fish market co-op in the Bronx is now joining the lawsuit to stop Equinor’s offshore Empire Wind project, providing anti-wind activists a powerful new ally in the public square.

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Q&A

How to Fight Back Against Anti-Renewable Activists

Getting local with Matthew Eisenson of Columbia Law School’s Sabin Center for Climate Change Law.

The Fight Q&A subject.
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This week’s conversation is with Matthew Eisenson at Columbia Law School’s Sabin Center for Climate Change Law. Eisenson is a legal expert and pioneer in the field of renewable energy community engagement whose work on litigating in support of solar and wind actually contributed to my interest in diving headlong into this subject after we both were panelists at the Society of Environmental Journalists’ annual conference last year. His team at the Sabin Center recently released a report outlining updates to their national project tracker, which looks at various facility-level conflicts at the local level.

On the eve of that report’s release earlier this month, Eisenson talked to me about what he believes are the best practices that could get more renewable projects over the finish line in municipal permitting fights. Oh — and we talked about Ohio.

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