Sign In or Create an Account.

By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy

Podcast

How Democrats Are Trying to Trump-Proof Their Big Climate Law

Rob and Jesse talk with the deputy White House official in charge of implementing the Inflation Reduction Act.

President Biden.
Heatmap Illustration/Getty Images

The Inflation Reduction Act, President Joe Biden’s landmark climate law, is the biggest investment in clean energy in American history. It is also in danger. In January, the Trump administration and a GOP Congress will take over the federal government — and they have made a variety of promises about how they’ll disrupt the law, ranging from full repeal to a more “surgical” reform approach.

On this week’s episode of Shift Key, Rob and Jesse talk with Kristina Costa, who has worked since 2022 to implement the IRA’s climate provisions at the White House. She joins us to discuss what went right about the Biden administration’s rush to implement the law, why state government capacity is holding back Democratic policy goals, and why the federal government needs more tools to support energy innovation if it wants to keep up with China. She also discusses how the administration is trying to Trump-proof the law. Shift Key is hosted by Robinson Meyer, the founding executive editor of Heatmap, and Jesse Jenkins, a professor of energy systems engineering at Princeton University.

Subscribe to “Shift Key” and find this episode on Apple Podcasts, Spotify, Amazon, or wherever you get your podcasts.

You can also add the show’s RSS feed to your podcast app to follow us directly.

Here is an excerpt from our conversation:

Robinson Meyer: What do you hear from the companies? And I guess from your vantage point, are they beginning to do the lobbying work you feel like they should be doing to protect the parts of the law that are working?

Kristina Costa: I think they are. You know, we hear a lot of anxiety, as you can imagine, which is —

Meyer: Theme of this period.

Costa: Theme of this period is that there’s a lot of anxiety. And our hope is, and our belief is that they will turn that anxiety into action, in terms of educating members of Congress about how the law actually works and how it is underpinning the investments that they’re making.

And I think, you know, to take a step back and talk about policy for a little bit, one of the things, I think, that is not well understood in the rhetoric about how the different pieces of the Inflation Reduction Act actually work together is that — you know, we have provisions that are incentivizing investments in manufacturing, and people are generally pretty excited about that. We also have provisions that are incentivizing adoption of the technologies that are being manufactured. And in some cases people are pretty excited about that, and in other cases, it has been turned into a bit of a political cudgel. But the fact of the matter is that those two things are pretty interdependent.

So, for instance, we have what is called the 45X advanced manufacturing production tax credit, and that is largely a per-unit tax credit that goes to manufacturers of a specified list of clean energy components, including batteries for electric vehicles, as well as for grid storage. And we have seen just gangbusters investment in the EV battery space since the passage of the Inflation Reduction Act. It has set the United States up to be an EV battery manufacturing powerhouse. And this is, of course, an area of importance for the clean energy transition. It is also an area of incredible importance for U.S. energy security, given the currently dominant market position that China plays, that China holds in the EV battery supply chain.

And I think people generally think this is pretty good. But one of the reasons besides the 45X credit just providing a strong, straight-up incentive to invest in the United States and make these things in the United States is that the much-maligned 30D new clean vehicle tax credit that provides a subsidy to individuals to buy electric vehicles that are made in the United States has a bunch of pretty stringent requirements about the sourcing of batteries and of critical minerals contained within those vehicles in order to be eligible for the tax credit. And so you have both incentives to manufacture, but you also basically have incentives to provide support for the offtake of what those manufacturers are actually producing.

Those two things go hand in hand, and I don’t think that is well understood in the political rhetoric.

This episode of Shift Key is sponsored by …

Watershed’s climate data engine helps companies measure and reduce their emissions, turning the data they already have into an audit-ready carbon footprint backed by the latest climate science. Get the sustainability data you need in weeks, not months. Learn more at watershed.com.

As a global leader in PV and ESS solutions, Sungrow invests heavily in research and development, constantly pushing the boundaries of solar and battery inverter technology. Discover why Sungrow is the essential component of the clean energy transition by visiting sungrowpower.com.

Intersolar & Energy Storage North America is the premier U.S.-based conference and trade show focused on solar, energy storage, and EV charging infrastructure. To learn more, visit intersolar.us.

Music for Shift Key is by Adam Kromelow.

Yellow

You’re out of free articles.

Subscribe today to experience Heatmap’s expert analysis 
of climate change, clean energy, and sustainability.
To continue reading
Create a free account or sign in to unlock more free articles.
or
Please enter an email address
By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy
Electric Vehicles

Tesla Is Now a Culture War Totem (Plus Some AI)

The EV-maker is now a culture war totem, plus some AI.

A Tesla taking an exit.
Heatmap Illustration/Getty Images, Tesla

During Alan Greenspan’s decade-plus run leading the Federal Reserve, investors and the financial media were convinced that there was a “Greenspan put” underlying the stock market. The basic idea was that if the markets fell too much or too sharply, the Fed would intervene and put a floor on prices analogous to a “put” option on a stock, which allows an investor to sell a stock at a specific price, even if it’s currently selling for less. The existence of this put — which was, to be clear, never a stated policy — was thought to push stock prices up, as it gave investors more confidence that their assets could only fall so far.

While current Fed Chair Jerome Powell would be loath to comment on a specific volatile security, we may be seeing the emergence of a kind of sociopolitical put for Tesla, one coming from the White House and conservative media instead of the Federal Reserve.

Keep reading...Show less
Green
Climate Tech

Climate Tech Is Facing a ‘Moment of Truth’

The uncertainty created by Trump’s erratic policymaking could not have come at a worse time for the industry.

Cliimate tech.
Heatmap Illustration/Getty Images

This is the second story in a Heatmap series on the “green freeze” under Trump.

Climate tech investment rode to record highs during the Biden administration, supercharged by a surge in ESG investing and net-zero commitments, the passage of the Infrastructure Investment and Jobs Act and Inflation Reduction Act, and at least initially, low interest rates. Though the market had already dropped somewhat from its recent peak, climate tech investors told me that the Trump administration is now shepherding in a detrimental overcorrection. The president’s fossil fuel-friendly rhetoric, dubiously legal IIJA and IRA funding freezes, and aggressive tariffs, have left climate tech startups in the worst possible place: a state of deep uncertainty.

Keep reading...Show less
Blue
Energy

AM Briefing: Overheard at CERAWeek

On the energy secretary’s keynote, Ontario’s electricity surcharge, and record solar power

CERAWeek Loves Chris Wright
Heatmap Illustration/Getty Images

Current conditions: Critical fire weather returns to New Mexico and Texas and will remain through Saturday • Sharks have been spotted in flooded canals along Australia’s Gold Coast after Cyclone Alfred dropped more than two feet of rain • A tanker carrying jet fuel is still burning after it collided with a cargo ship in the North Sea yesterday. The ship was transporting toxic chemicals that could devastate ecosystems along England’s northeast coast.

THE TOP FIVE

1. Chris Wright says climate change is a ‘side effect of building the modern world’

In a keynote speech at the energy industry’s annual CERAWeek conference, Energy Secretary Chris Wright told executives and policymakers that the Trump administration sees climate change as “a side effect of building the modern world,” and said that “everything in life involves trade-offs." He pledged to “end the Biden administration’s irrational, quasi-religious policies on climate change” and insisted he’s not a climate change denier, but rather a “climate realist.” According toThe New York Times, “Mr. Wright’s speech was greeted with enthusiastic applause.” Wright also reportedly told fossil fuel bosses he intended to speed up permitting for their projects.

Keep reading...Show less
Yellow