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How the state’s renewables boom is testing a key political theory about the climate economy
One of the central conceits of the Inflation Reduction Act, Biden’s landmark climate legislation, is that green investment will eventually lead to bipartisan support for the law. No Republican may have crossed the aisle to support the IRA in 2022, but when money flows into red districts, conservatives will come around. Or so the thinking goes.
The reality is proving more complicated. Some academic research has indeed suggested that investments in the climate economy can lead to positive political feedback. There have also been notable examples of conservative politicians supporting factories that produce batteries and solar panels. But our home state of Texas provides a more cautionary tale, particularly when it comes to the generation of renewable energy itself.
At the University of Texas at Austin, we recently conducted a study that investigated how unprecedented investment in the state’s clean energy industry has affected legislation. To put it bluntly, the results were the opposite of what renewable advocates would hope to see.
After winter storm Uri battered Texas in 2021, leading to major power outages, Republicans in the Texas state legislature introduced numerous bills to address what they claimed was the major culprit: renewable energy. (Democrats blamed fossil fuels.) Wind and solar had grown exponentially in recent years, turning Texas into the first and second largest state for their provision respectively. Nevertheless, along with bills to increase gas power production and reliability, Republicans targeted renewable energy for increased regulation, higher fees, and outright construction bans. Labeled the “War on Renewables”, some of these policies were called “industry killers” by renewable energy advocates. The majority of these bills were introduced in the Texas Senate.
Senate Bill 7 and Senate Bill 1287 both proposed new fees for wind and solar projects. Senate Bill 2012 would lead to charges on renewable projects to help fund the building of gas plants, and Senate Bill 2015 would require half of all generation in Texas to come from non-renewable sources. Perhaps the most damaging of bills would have led to a new permitting process that only applied to renewable energy generation (SB 624). Most of these bills passed the Texas Senate but didn’t receive a vote in the Texas House.
We analyzed the relationship between voting on these Senate bills and renewable energy investments in legislators’ districts. Of the 31 Texas Senate districts, seven have considerable wind investments and 12 have solar projects built or proposed.
Interestingly, many of the urban Democratic districts have little or no renewable energy projects. That’s probably because utility-scale wind and solar requires not only wind and sun, but available land. This land is often found in rural areas that are the strongholds of the Republican Party.
First, we present the major renewable energy bills and the partisan voting on this legislation. The pattern is clear. SB 258, one of the few pro-renewable bills, received full support from Democratic senators. Anti-renewable bills were introduced by Republican senators and they received overwhelming support from their party. Conversely, few Democrats supported these bills in what amounts to extremely partisan voting.
This partisan pattern is unsurprising on the surface, but economic interests can also drive voting on renewable energy policy. How did renewable energy investment shape voting on these bills?
The Advanced Power Association, arguably the most powerful renewable energy association in Texas, provides a map on their website of renewable energy investments by Senate and House district in Texas. This underlying data, complied by IdeaSmiths and shared with us by Josh Rhodes, is the same data that can be accessed by legislators on the impact of renewable energy in their districts. This data includes solar, wind, and renewable energy story investments, proposed investments, and estimated local tax revenues from these projects. For simplicity we present total megawatts of proposed, under construction, and built wind and solar projects, but we note the patterns we identify are consistent with different codings of this data.
The lack of correlation between renewable energy investment and voting on renewable legislation is striking. Politicians voting against renewable energy here actually had more wind and solar investment and greater estimated tax revenues from renewables in their districts. In fact, many of the authors of the anti-renewable bills have some of the largest renewable investments in the state. Meanwhile, SB 258, one of the few pro-renewable bills, received greater support from districts with fewer renewable energy projects. Our interpretation is simply that renewable energy investment has no impact on renewable energy voting.
How can that be? We offer three possible explanations.
The first, and most unlikely, is that fossil fuel interests are driving this war on renewables. While plausible, this explanation is forced to confront the fact that the majority of renewable energy projects in these areas are actually owned by fossil fuel owners. In a roundtable recapping this previous legislative session, renewable energy advocates, including the Advanced Power Alliance, directly stated that they didn’t think this legislation was driven by fossil fuel interests.
The second, which feels more likely, is that renewable energy generation isn’t leading to the kinds of jobs or government revenue that can insulate it from danger. Most of these projects have received considerable tax abatements from cities, counties, and local school districts, limiting their positive fiscal impact. They also employ relatively few workers once construction is complete. For example, the most recent Texas application for school tax abatements is Skull Creek Solar’s $147-million solar energy project. In their application for school tax abatements, they propose the creation of one job. If these projects are generating little tax revenue and few jobs, of course skeptical politicians might be indifferent to their fates. In contrast, other green investments, such as electric vehicle assembly and supply chains, can create thousands of jobs.
The third, and most likely of all, is that renewable energy has simply become another front in America’s ever-widening culture war. And the partisan passage of the IRA may have exacerbated the divide.
Now, our data analysis examines one state and alternative dynamics might be at play in other places. But given the depth of renewable energy investment in Texas and the waves of anti-renewable legislation in renewable energy districts, our analysis suggests limits to the relationship between renewable energy investment and politics.
Hopes that green energy investments in Republican districts will lead to changes in voting on renewable energy are inconsistent with our findings in Texas.
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The Loan Programs Office is good for more than just nuclear funding.
That China has a whip hand over the rare earths mining and refining industry is one of the few things Washington can agree on.
That’s why Alex Jacquez, who worked on industrial policy for Joe Biden’s National Economic Council, found it “astounding”when he read in the Washington Post this week that the White House was trying to figure out on the fly what to do about China restricting exports of rare earth metals in response to President Trump’s massive tariffs on the country’s imports.
Rare earth metals have a wide variety of applications, including for magnets in medical technology, defense, and energy productssuch as wind turbines and electric motors.
Jacquez told me there has been “years of work, including by the first Trump administration, that has pointed to this exact case as the worst-case scenario that could happen in an escalation with China.” It stands to reason, then, that experienced policymakers in the Trump administration might have been mindful of forestalling this when developing their tariff plan. But apparently not.
“The lines of attack here are numerous,” Jacquez said. “The fact that the National Economic Council and others are apparently just thinking about this for the first time is pretty shocking.”
And that’s not the only thing the Trump administration is doing that could hamper American access to rare earths and critical minerals.
Though China still effectively controls the global pipeline for most critical minerals (a broader category that includes rare earths as well as more commonly known metals and minerals such as lithium and cobalt), the U.S. has been at work for at least the past five years developing its own domestic supply chain. Much of that work has fallen to the Department of Energy, whose Loan Programs Office has funded mining and processing facilities, and whose Office of Manufacturing and Energy Supply Chains hasfunded and overseen demonstration projects for rare earths and critical minerals mining and refining.
The LPO is in line for dramatic cuts, as Heatmap has reported. So, too, are other departments working on rare earths, including the Office of Manufacturing and Energy Supply Chains. In its zeal to slash the federal government, the Trump administration may have to start from scratch in its efforts to build up a rare earths supply chain.
The Department of Energy did not reply to a request for comment.
This vulnerability to China has been well known in Washington for years, including by the first Trump administration.
“Our dependence on one country, the People's Republic of China (China), for multiple critical minerals is particularly concerning,” then-President Trump said in a 2020 executive order declaring a “national emergency” to deal with “our Nation's undue reliance on critical minerals.” At around the same time, the Loan Programs Office issued guidance “stating a preference for projects related to critical mineral” for applicants for the office’s funding, noting that “80 percent of its rare earth elements directly from China.” Using the Defense Production Act, the Trump administration also issued a grant to the company operating America's sole rare earth mine, MP Materials, to help fund a processing facility at the site of its California mine.
The Biden administration’s work on rare earths and critical minerals was almost entirely consistent with its predecessor’s, just at a greater scale and more focused on energy. About a month after taking office, President Bidenissued an executive order calling for, among other things, a Defense Department report “identifying risks in the supply chain for critical minerals and other identified strategic materials, including rare earth elements.”
Then as part of the Inflation Reduction Act in 2022, the Biden administration increased funding for LPO, which supported a number of critical minerals projects. It also funneled more money into MP Materials — including a $35 million contract from the Department of Defense in 2022 for the California project. In 2024, it awarded the company a competitive tax credit worth $58.5 million to help finance construction of its neodymium-iron-boron magnet factory in Texas. That facilitybegan commercial operation earlier this year.
The finished magnets will be bought by General Motors for its electric vehicles. But even operating at full capacity, it won’t be able to do much to replace China’s production. The MP Metals facility is projected to produce 1,000 tons of the magnets per year.China produced 138,000 tons of NdFeB magnets in 2018.
The Trump administration is not averse to direct financial support for mining and minerals projects, but they seem to want to do it a different way. Secretary of the Interior Doug Burgum has proposed using a sovereign wealth fund to invest in critical mineral mines. There is one big problem with that plan, however: the U.S. doesn’t have one (for the moment, at least).
“LPO can invest in mining projects now,” Jacquez told me. “Cutting 60% of their staff and the experts who work on this is not going to give certainty to the business community if they’re looking to invest in a mine that needs some government backstop.”
And while the fate of the Inflation Reduction Act remains very much in doubt, the subsidies it provided for electric vehicles, solar, and wind, along with domestic content requirements have been a major source of demand for critical minerals mining and refining projects in the United States.
“It’s not something we’re going to solve overnight,” Jacquez said. “But in the midst of a maximalist trade with China, it is something we will have to deal with on an overnight basis, unless and until there’s some kind of de-escalation or agreement.”
A conversation with VDE Americas CEO Brian Grenko.
This week’s Q&A is about hail. Last week, we explained how and why hail storm damage in Texas may have helped galvanize opposition to renewable energy there. So I decided to reach out to Brian Grenko, CEO of renewables engineering advisory firm VDE Americas, to talk about how developers can make sure their projects are not only resistant to hail but also prevent that sort of pushback.
The following conversation has been lightly edited for clarity.
Hiya Brian. So why’d you get into the hail issue?
Obviously solar panels are made with glass that can allow the sunlight to come through. People have to remember that when you install a project, you’re financing it for 35 to 40 years. While the odds of you getting significant hail in California or Arizona are low, it happens a lot throughout the country. And if you think about some of these large projects, they may be in the middle of nowhere, but they are taking hundreds if not thousands of acres of land in some cases. So the chances of them encountering large hail over that lifespan is pretty significant.
We partnered with one of the country’s foremost experts on hail and developed a really interesting technology that can digest radar data and tell folks if they’re developing a project what the [likelihood] will be if there’s significant hail.
Solar panels can withstand one-inch hail – a golfball size – but once you get over two inches, that’s when hail starts breaking solar panels. So it’s important to understand, first and foremost, if you’re developing a project, you need to know the frequency of those events. Once you know that, you need to start thinking about how to design a system to mitigate that risk.
The government agencies that look over land use, how do they handle this particular issue? Are there regulations in place to deal with hail risk?
The regulatory aspects still to consider are about land use. There are authorities with jurisdiction at the federal, state, and local level. Usually, it starts with the local level and with a use permit – a conditional use permit. The developer goes in front of the township or the city or the county, whoever has jurisdiction of wherever the property is going to go. That’s where it gets political.
To answer your question about hail, I don’t know if any of the [authority having jurisdictions] really care about hail. There are folks out there that don’t like solar because it’s an eyesore. I respect that – I don’t agree with that, per se, but I understand and appreciate it. There’s folks with an agenda that just don’t want solar.
So okay, how can developers approach hail risk in a way that makes communities more comfortable?
The bad news is that solar panels use a lot of glass. They take up a lot of land. If you have hail dropping from the sky, that’s a risk.
The good news is that you can design a system to be resilient to that. Even in places like Texas, where you get large hail, preparing can mean the difference between a project that is destroyed and a project that isn’t. We did a case study about a project in the East Texas area called Fighting Jays that had catastrophic damage. We’re very familiar with the area, we work with a lot of clients, and we found three other projects within a five-mile radius that all had minimal damage. That simple decision [to be ready for when storms hit] can make the complete difference.
And more of the week’s big fights around renewable energy.
1. Long Island, New York – We saw the face of the resistance to the war on renewable energy in the Big Apple this week, as protestors rallied in support of offshore wind for a change.
2. Elsewhere on Long Island – The city of Glen Cove is on the verge of being the next New York City-area community with a battery storage ban, discussing this week whether to ban BESS for at least one year amid fire fears.
3. Garrett County, Maryland – Fight readers tell me they’d like to hear a piece of good news for once, so here’s this: A 300-megawatt solar project proposed by REV Solar in rural Maryland appears to be moving forward without a hitch.
4. Stark County, Ohio – The Ohio Public Siting Board rejected Samsung C&T’s Stark Solar project, citing “consistent opposition to the project from each of the local government entities and their impacted constituents.”
5. Ingham County, Michigan – GOP lawmakers in the Michigan State Capitol are advancing legislation to undo the state’s permitting primacy law, which allows developers to evade municipalities that deny projects on unreasonable grounds. It’s unlikely the legislation will become law.
6. Churchill County, Nevada – Commissioners have upheld the special use permit for the Redwood Materials battery storage project we told you about last week.