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Q&A

How the GOP Tax Bill Would Supercharge Renewable Energy NIMBYs

A conversation with Jillian Blanchard of Lawyers for Good Government about the heightened cost of permitting delays

Jillian Blanchard.
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This week I chatted with Jillian Blanchard, vice president of climate change and environmental justice with Lawyers for Good Government, an organization that has been supporting beneficiaries of the Inflation Reduction Act navigate the uncertainties surrounding tax credits and grant programs under the Trump administration. The reason I wanted to chat with Jillian is simple: the IRA is under threat for the first time under a Republican Congress. I wanted to understand how solar and wind projects could be impacted by the House Republican reconciliation bill and putting IRA tax credits in doubt. I learned a lot.

The following conversation was lightly edited for clarity.

Okay, Jillian, what’s the topline here? How would the GOP reconciliation bill impact individual projects’ development?

There are big chunks of the reconciliation bill that will have dramatic impacts on project development, including language that would repeal or phase out bipartisan and popular tax credits in a way that would make it very, very difficult to invest in projects. I can get into the weeds next.

But it’s worth saying first – the group of programs aside from tax credits that [House Republicans] would repeal represents every single part of America. Hundreds of projects that will not go forward if these programs are not going well. And they have several legally obligated grants that EPA has already mucked up in a litany of ways. But what they’re proposing to do is to pull the rug out from under those programs. On top of that they want to pull any unobligated funding out.

I think it’s extremely misrepresentative to say these are not big cuts. They’re significant cuts to clean air and clean water across the board.

Help me get into the weeds about how phasing out the credits will make it harder to invest in a project.

Right now, a bank might want to invest a certain amount of money in a clean energy project because they know on the back end they can get 30% or 40% back on their investment. A return through tax credits. They can bank on that, because tax credits are a guarantee.

Was that an intentional pun? “Bank”?

Yeah, it is. I love a good pun. You opened the floodgates, that was a mistake.

But anyway, the program itself was supposed to be around until at least 2032 and the bank could bank on those tax credits. That’s a big runway, because projects could get delayed and you could lock in the credit as soon as you started construction.

Now they’re doing a phase-out approach where if your project is not placed into service before a certain date, you don’t avoid the phase out. You don’t get any protections if you’re starting your project now or next year. It has to be placed in service before 2028 or else your project may not be eligible. You are constructing it, you are financing it, but then through no fault of your own – a storm or whatever – then suddenly that project is no longer entitled to get 30% or 40% back.

That’s a big risk. And banks don’t like risk.

Opposition on the ground also delays projects the way a storm does. Would this empower those opponents?

Oh, totally. Totally. If anyone wants to fight a project, a bank might be even less likely to invest in it. The NIMBYs for that particular project become a risk.

What would you tell a developer at this moment who is wondering about the uncertainty around the IRA?

I would tell them that now is the time to speak up. If they want to stay in this business and make sure their energy stays as low-cost as it already is, they need to speak up right now, no matter what their political party affiliation is. Make it clear solar isn’t going away, wind isn’t going away, storage isn’t going away. These are markets America needs to be competitive with the rest of the world.

Yellow

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Q&A

How Are Renewable Energy Developers Reacting to IRA Cuts?

A conversation with Mike Hall of Anza.

The Fight's Q&A subject.
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This week’s conversation is with Mike Hall, CEO of the solar and battery storage data company Anza. I rang him because, in my book, the more insights into the ways renewables companies are responding to the war on the Inflation Reduction Act, the better.

The following chat was lightly edited for clarity. Let’s jump in!

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Hotspots

A Solar Flare-Up in New York, Battery Aftershocks in California

And more of the week’s top news in renewable energy conflicts.

The United States.
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1. Columbia County, New York – A Hecate Energy solar project in upstate New York blessed by Governor Kathy Hochul is now getting local blowback.

  • Last week, the Hochul administration granted many solar projects their renewable energy certificates, including Hecate’s Shepherd’s Run solar project in the town of Copake. Shepherd’s Run has struggled for years with its application process and was previously rejected by state land use regulators.
  • This certificate award has now inflamed longstanding local criticism of the project, which has persisted due to its proximity to schools and concerns about fire risk.
  • We’ll find out whether this flare-up will cause more headaches when the state’s Renewable Energy Siting office completes reviewing Hecate’s application in 60 days.

2. Sussex County, Delaware – The battle between a Bethany Beach landowner and a major offshore wind project came to a head earlier this week after Delaware regulators decided to comply with a massive government records request.

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Spotlight

Trump Targets Solar on Farmland

Anti-solar activists in agricultural areas get a powerful new ally.

Sheep and solar panels.
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The Trump administration is joining the war against solar projects on farmland, offering anti-solar activists on the ground a powerful ally against developers across the country.

In a report released last week, President Trump’s Agriculture Department took aim at solar and stated competition with “solar development on productive farmland” was creating a “considerable barrier” for farmers trying to acquire land. The USDA also stated it would disincentivize “the use of federal funding” for solar “through prioritization points and regulatory action,” which a spokesperson – Emily Cannon – later clarified in an email to me this week will include reconfiguring the agency’s Rural Energy for America loan and grant program. Cannon declined to give a time-table for the new regulation, stating that the agency “will have more information when the updates are ready to be published.”

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