You’re out of free articles.
Log in
To continue reading, log in to your account.
Create a Free Account
To unlock more free articles, please create a free account.
Sign In or Create an Account.
By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy
Welcome to Heatmap
Thank you for registering with Heatmap. Climate change is one of the greatest challenges of our lives, a force reshaping our economy, our politics, and our culture. We hope to be your trusted, friendly, and insightful guide to that transformation. Please enjoy your free articles. You can check your profile here .
subscribe to get Unlimited access
Offer for a Heatmap News Unlimited Access subscription; please note that your subscription will renew automatically unless you cancel prior to renewal. Cancellation takes effect at the end of your current billing period. We will let you know in advance of any price changes. Taxes may apply. Offer terms are subject to change.
Subscribe to get unlimited Access
Hey, you are out of free articles but you are only a few clicks away from full access. Subscribe below and take advantage of our introductory offer.
subscribe to get Unlimited access
Offer for a Heatmap News Unlimited Access subscription; please note that your subscription will renew automatically unless you cancel prior to renewal. Cancellation takes effect at the end of your current billing period. We will let you know in advance of any price changes. Taxes may apply. Offer terms are subject to change.
Create Your Account
Please Enter Your Password
Forgot your password?
Please enter the email address you use for your account so we can send you a link to reset your password:
Russ Vought could jeopardize the next decade of climate science. But who is he?
It is my sincere belief that, as with many aspects of governance, thinking about climate policy bores former President Donald Trump. He is not without his hobbyhorses — wind turbines are ugly bird-killers; it’s freezing in New York, so where the hell is global warming? — but on the whole, I tend to agree with the assessment that he basically believes “nothing” on climate change. Trump simply isn’t all that interested. He prefers to let the others do the thinking for him.
This isn’t a knock on Trump, per se; part of leading a bureaucracy as big and as complicated as the United States government is surrounding yourself with people who can offload some of that thinking for you. But the crucial question then becomes: Who is doing that thinking?
The answer, to a large extent, is Russ Vought.
The name might not immediately ring a bell. Biographical details of the 48-year-old career bureaucrat can be hard to find (“a native of Trumbull, Connecticut,” “the youngest of seven children,” “a die-hard Yankees fan”), giving the impression that Vought came out of nowhere. In a sense, he did: For years, Vought dealt mainly with spreadsheets as he worked first as a budget staffer for Texas Republican Sen. Phil Gramm and Rep. Jeb Hensarling, then later for then-Rep. Mike Pence, and eventually the Heritage Foundation. It was Gramm, though, who gave Vought his outlook on the world: “If you do budget, you do everything.”
After a stint with the Trump transition team, Vought became deputy director of the Office of Management and Budget in 2018, and took over entirely in 2019. At OMB, he famously held up military aid to Ukraine in what became the subject of Trump’s first impeachment. Described as “ideological in the extreme,” “adversarial” with his colleagues, and having an “aggressive personal style” — incongruous, perhaps, with his somewhat nerdy, bespectacled appearance — Vought would reportedly go too far in proposed budget cuts sometimes even for his boss.
After Biden’s win in 2020, Vought launched the Center for American Restoration, a pro-Trump think tank with the mission of renewing “a consensus of America as a nation under God,” and has otherwise kept busy with appearances on conservative-friendly talk shows on One America News Network and Fox News. Steve Bannon has approvingly dubbed him “MAGA’s bulldog,” though he rarely speaks to the mainstream press. (I received a failed delivery message in response to an email to the address listed on the website for the Center for American Restoration; other attempts to contact Vought went unanswered.)
Vought is all but assured to take up a powerful position in a potential incoming Trump cabinet. He “trained up during the first Trump administration, and he is looking to apply those skills that he learned in a second,” said Alex Witt, the senior advisor for oil and gas at Climate Power, a strategic communications group that shared its research on Vought with me.
Vought may not be the most obvious architect for the project of dismantling climate progress, however. In Project 2025, the Heritage Foundation’s roadmap for the next Republican president, Vought authored the chapter on the Office of the President of the United States — hardly the most climate-y section, given that there are also chapters on reforming the Environmental Protection Agency, the Department of Energy, and the Department of the Interior. A flurry of new articles about Vought describe him as a Christian nationalist crusader preoccupied with fending off big government and orchestrating an expansion of presidential powers.
But just as Trump advisor Stephen Miller shaped far-right immigration policies from behind the scenes, Vought would be a hidden hand in a future administration dismantling climate progress. In his chapter in Project 2025, for example, Vought proposes moving the National Defense Strategy from under the purview of the Defense Department to the White House and its National Security Council — normal “expansion of presidential powers” stuff. But Vought goes even further, directing the NSC then to “rigorously review” the staff with an eye for “climate change … and other polarizing policies that weaken our armed force.”
Erin Sikorsky, the director of the Center for Climate and Security, told me that such a proposal indicates “a misunderstanding of how connected climate hazards are to the core duties of what the military is focused on.” It could also put the U.S. armed forces on the back foot in conflicts around the world if it’s followed through. As just one example, if the military isn’t engaging with its Indo-Pacific partners “and helping those countries build resilience to climate change, then China is more than happy to step in and address that,” Sikorsky warned. At home, NSC analyses of the domestic impacts of climate change will likely come to a halt, scuttling future coordination between the military and local governments after disasters and hampering mitigation efforts around the country.
The most significant blow on the climate front, however, would come from Vought’s proposal to reinstate Schedule F, a job classification that aims to convert at least 50,000 career civil servants to “at-will” political employees. (Trump used an executive order to implement Schedule F at the very end of his term; President Biden unimplemented it soon after taking office.) The employment classification ostensibly aims to make it easier to replace “rogue” or “woke” civil servants and would-be whistleblowers, a.k.a. “the deep state,” with party-line faithful. But in the words of Vought himself, Schedule F is also necessary because Biden’s “climate fanaticism will need a whole-of-government unwinding.”
The effects of such a decision, experts told me, could range from very bad to disastrous self-sabotage. Schedule F is “designed to be a tool to purge federal agencies of nonpartisan experts” and replace them with “partisan loyalists who would willingly follow any order without question, regardless of whether it was legal, constitutional, or the right thing to do for the people,” Joe Spielberger, the policy counsel at the Project on Government Oversight, an independent and nonpartisan watchdog group, told me. In practice, that might mean firing longtime civil servants perceived as not loyal enough, or even just “creating and perpetuating a climate of fear and intimidation where people are not able or willing to speak out when they see abuse of power and other corruption happening.”
Such a scenario is concerning for employees at agencies like the National Oceanic and Atmospheric Administration who work on climate modeling. But the expertise of the U.S. civil service is broad and deep; Schedule F could impact everyone from the economists, lawyers, and engineers who work on something like the Corporate Average Fuel Economy standards to the people who sit on the Clean Air Scientific Advisory Committee.
“Civil service positions are not classified as political appointees for a reason, which is so that staff, especially scientists, can do work that spans administrations because it is so fundamental to public health and welfare,” Chitra Kumar, the Union of Concerned Scientists’ managing director for climate and energy, told me in an email. The people made fireable under Schedule F, in other words, are the ones who actually know what is going on, whereas “elected officials come and go, often taking a year or more to understand the latest underlying science.”
Reimplementing and expanding Schedule F, however, is apparently one of Vought’s greatest ambitions. Earlier this year, the National Treasury Employees Union obtained documents via a Freedom of Information Act request that showed Vought’s intent to apply the status to much of OMB’s workforce in 2020. As justification for taking an implicit machete to his staff, Vought writes in Project 2025 that “it is the president’s agenda that should matter to the departments and agencies that operate under his constitutional authority,” but that instead, the U.S. civil service is “all too often … carrying out its own policy plans and preferences — or, worse yet, the policy plans and preferences of a radical, supposedly ‘woke’ faction of the country.”
Ann Carlson, the former acting administrator of the National Highway Traffic Safety Administration and a professor of environmental law at UCLA, strongly refutes Vought’s claim. For one thing, she told me that the great irony of the Schedule F proposal is that it would make it more difficult for the Trump administration to carry out its goals in the long run.
“Part of the problem for a conservative administration is, if you want to roll back policies that are in place, you need people who know how to do that,” Carlson pointed out. She also bristled at the suggestion that civil servants are unable to check their biases at the door: Carlson’s team at NHTSA helped put together the Biden administration’s rules to strengthen fuel economy standards, but it also worked to roll back the Obama administration’s regulations and replaced them with the SAFE standards under Trump. “I don’t actually know, for most of them, which one they preferred,” Carlson said.
Carlson wasn’t the only former political appointee I spoke with who fiercely defended the integrity of her staff. Ron Sanders, a three-year Trump appointee, so vehemently opposed Schedule F when it was briefly implemented in 2020 that he resigned as chairman of the Federal Salary Council. Today, he represents a group of Republican former national security officials who are imploring Congress to find a middle ground between the current status quo and the extreme political loyalty demanded by Schedule F.
When I read Sanders the part of Vought’s Project 2025 chapter that calls for weeding out the “radical, supposedly ‘woke’ faction of the country,” he told me that such thinking is “myopic.” “This is potentially a Republican administration coming in and finding ‘Democrats’ in place,” Sanders said. “You could say the same thing about the Biden administration, but they knew better — they knew that senior career officials appointed in the Trump administration are still politically neutral. It just happened to be a matter of timing.”
It likewise struck me as curious that Vought would push so hard for a policy that would not only hamstring the Trump administration but might also allow future Democratic presidents to carry out purges of perceived conservative government operatives.
The Biden administration has made moves to prevent Schedule F from potentially returning under a different president. Still, Spielberger from the Project on Government Oversight told me that short of a legislative fix by Congress, such actions will only delay reimplementation of the policy by “a matter of months” should Trump be reelected. The damage to climate science from four years of Schedule F, however, could be drastic.
“What we’re going to end up with is an executive branch that’s just uninformed,” Daniel Farber, the director of the Center for Law, Energy, and the Environment at the University of California, Berkeley, stressed to me. Farber’s fear is not just that “a bunch of uninformed ideologues” would be running the show, but also that once government experts are kicked out, it will be difficult to replace them or entice them to return.
“Even after we go back to a Democratic president, you can’t wave a wand and get all those people back,” Farber said. In the first nine months of the Trump administration, for example, the EPA lost more than 700 employees — and that was due to poor morale and high turnover even without the threat of Schedule F.
Schedule F doesn’t just chase out climate-related experts from the government. It also accelerates the revolving door that allows anti-climate zealots actors in. Both the Heritage Foundation and Vought’s think tank, the Center for American Restoration, have taken money from Big Oil groups and executives. Trump has already made his own transactional assurances to the industry if it funds his return to the White House. Schedule F, meanwhile, would open up hundreds if not thousands of positions for unqualified political operatives — essentially creating a “spoils system” where the lines between government and private industry would blur more than they already do.
“Russ Vought is not the problem,” Witt, of Climate Power, told me. “The problem is Donald Trump: Donald and the GOP are bought out by Big Oil, and Vought and other bad actors are a cog in that machine.”
It’s a metaphor that works well for the federal government, too: What happens when you have 50,000 cogs, but the person you’ve deferred to run the machine has fired all the mechanics?
“You take out all that expertise, all the people who understand how the system works?” Carlson, the former NHTSA director, said. “Good luck to you.”
Log in
To continue reading, log in to your account.
Create a Free Account
To unlock more free articles, please create a free account.
Empire Wind has been spared — but it may be one of the last of its kind in the U.S.
It’s been a week of whiplash for offshore wind.
On Monday, President Trump lifted his stop work order on Empire Wind, an 810-megawatt wind farm under construction south of Long Island that will deliver renewable power into New York’s grid. But by Thursday morning, Republicans in the House of Representatives had passed a budget bill that would scrap the subsidies that make projects like this possible.
The economics of building offshore wind in the U.S., at least during this nascent stage, are “entirely dependent” on tax credits, Marguerite Wells, the executive director of Alliance for Clean Energy New York, told me.
That being said, if the bill gets through the Senate and becomes law, Empire Wind may still be safe. The legislation would significantly narrow the window for projects to qualify for tax credits, requiring them to start construction by the end of this year and be operational by the end of 2028. Equinor, the company behind Empire Wind, maintains that it aims to reach commercial operations as soon as 2027. The four other offshore wind projects that are under construction in the U.S. — Sunrise Wind, also serving New York; Vineyard Wind, serving Massachusetts; Revolution Wind, serving Rhode Island and Connecticut; and Dominion Energy’s project in Virginia — are also expected to be completed before the cutoff.
Together, the five wind farms are expected to generate enough power for roughly 2.5 million homes and avoid more than 9 million tons of carbon emissions each year — similar to shutting down 23 natural gas-fired power plants.
Still, this would represent just a small fraction of the carbon-free energy eastern states are counting on offshore wind to provide. New York, for example, has a statutory goal of getting at least 9 gigawatts of power from the industry. Once Empire and Sunrise are completed, it will have just 1.7 gigawatts.
If the proposed changes to the tax credits are enacted, these five projects may be the last built in the U.S.
That’s not the case for solar farms or onshore wind, Oliver Metcalfe, head of wind research at BloombergNEF told me. They can still compete with fossil fuel generation — especially in the windiest and sunniest areas — without tax credits. That’s especially true in today’s environment of rising demand for power, since these projects have the additional benefit of being quick to build. The downside of losing the tax credits is, of course, that the power will cost marginally more than it otherwise would have.
For offshore wind farms to pencil out, however, states would have to pay a much higher price for the energy they produce. The tax credits knock off about a quarter of the price, Metcalfe said; without them, buyers will be back on the hook. “It’s likely that some either wouldn’t be willing to do that, or would dramatically decrease their ambition around the technology given the potential impacts it could have on ratepayers.”
Part of the reason offshore wind is so expensive is that the industry is still new in the U.S. We lack the supply chains, infrastructure, and experienced workforce built up over time in countries like China and the U.K. that have been able to bring costs down. That’s likely not going to change by the time these five projects are built, as they are all relying on European supply chains.
The Inflation Reduction Act spurred domestic manufacturers to begin developing supply chains to serve the next wave of projects, Wells told me. It gave renewable energy projects a 10-year runway to start construction to be eligible for the tax credits. “It was a long enough time window for companies to really invest, not just in the individual generation projects, but also manufacturing, supply chain, and labor chain,” she said.
Due to Trump’s attacks on the industry, the next wave of projects may not materialize, and those budding supply chains could go bust.
Trump put a freeze on offshore wind permitting and leasing on his first day in office, a move that 17 states are now challenging in court. A handful of projects are already fully permitted, but due to uncertainty around Trump’s tariffs — and now, around whether they’ll have access to the tax credits — they’re at a standstill.
“No one’s willing to back a new offshore wind project in today’s environment because there’s so much uncertainty around the future business case, the future subsidies, the future cost of equipment,” Metcalfe said.
The House budget bill may have kept the 45Q tax credit, but nixing transferability makes it decidedly less useful.
Very few of the Inflation Reduction Act’s tax credits made it through the House’s recently passed budget bill unscathed. One of the apparently lucky ones, however, was the 45Q credit for carbon capture projects. This provides up to $180 per metric ton for direct air capture and $85 for carbon captured from industrial or power facilities, depending on how the CO2 is subsequently sequestered or put to use in products such as low-carbon aviation fuels or building materials. The latest version of the bill doesn’t change that at all.
But while the preservation of 45Q is undoubtedly good news for the increasing number of projects in this space, carbon capture didn’t escape fully intact. One of the main ways the IRA supercharged tax credits was by making them transferable, turning them into an important financing tool for small or early-stage projects that might not make enough money to owe much — or even anything — in taxes. Being able to sell tax credits on the open market has often been the only way for smaller developers to take advantage of the credits. Now, the House bill will eliminate transferability for all projects that begin construction two years after the bill becomes law.
That’s going to make the economics of an already financially unsteady industry even more difficult. “Especially given the early stage of the direct air capture industry, transferability is really key,” Giana Amador, the executive director of an industry group called the Carbon Removal Alliance, told me. “Without transferability, most DAC companies won’t be able to fully capitalize upon 45Q — which, of course, threatens the viability of these projects.”
We’re not talking about just a few projects, either. We’re talking about the vast majority, Jessie Stolark, the executive director of another industry group, the Carbon Capture Coalition, told me. “The initial reaction is that this is really bad, and would actually cut off at the knees the utility of the 45Q tax credit,” Stolark said. Out of over 270 carbon capture projects announced as of today, Stolark estimates that fewer than 10 will be able to begin construction in the two years before transferability ends.
The alternative to easily transferable tax credits is a type of partnership between a project developer and a tax equity investor such as a bank. In this arrangement, investors give project developers cash in exchange for an equity stake in their project and their tax credit benefits. Deals like this are common in the renewable energy industry, but because they’re legally complicated and expensive, they’re not really viable for companies that aren’t bringing in a lot of revenue.
Because carbon capture is a much younger, and thus riskier technology than renewables, “tax equity markets typically require returns of 30% or greater from carbon capture and direct air capture project developers,” Stolark told me. That’s a much higher rate than tax equity partners typically require for wind or solar projects. “That out of the gate significantly diminishes the tax credit's value.” Taken together with inflation and high interest rates, all this means that “far fewer projects will proceed to construction,” Stolark said.
One DAC company I spoke with, Bay Area-based Noya, said that now that transferability is out, it has been exploring the possibility of forming tax equity partnerships. “We’ve definitely talked to banks that might be interested in getting involved in these kinds of things sooner than they would have otherwise gotten involved, due to the strategic nature of being partnered with companies that are growing fast,” Josh Santos, Noya’s CEO, told me.
It would certainly be a surprise to see banks — which are generally quite risk averse — lining up behind these kinds of new and unproven technologies, especially given that carbon capture doesn’t have much of a natural market. While CO2 can be used for some limited industrial purposes — beverage carbonation, sustainable fuels, low-carbon concrete — the only market for true carbon dioxide removal is the voluntary market, in which companies, governments, or individuals offset their own emissions by paying companies to remove carbon from the atmosphere. So if carbon capture is going to become a thriving, lucrative industry, it’s likely going to be heavily dependent on future government incentives, mandates, or purchasing commitments. And that doesn’t seem likely to happen in the U.S. anytime soon.
Noya, which is attempting to deploy its electrically-powered, modular direct air capture units beginning in 2027, is still planning on building domestically, though. As Santos told me, he’s eyeing California and Texas as promising sites for the company’s first projects. And while he said that the repeal of transferability will certainly “make things more complicated,” it is not enough of a setback for the company to look abroad.
“45Q is a big part of why we are focused on the U.S. mainly as our deployment site,” Santos explained. “We’ve looked at places like Iceland and the Middle East and Africa for potential deployment locations, and the tradeoff of losing 45Q in exchange for a cheaper something has to be significant enough for that to make sense,” he told me — something like more cost efficient electricity, permitting or installation costs. Preserving 45Q, he told me, means Noya’s long-term project economics are still “great for what we’re trying to build.”
But if companies can’t weather the short-term headwinds, they’ll never be able to reach the level of scale and profitability that would allow them to leverage the benefits of the 45Q credits directly. For many DAC companies such as Climeworks, which built the industry’s largest facility in Iceland, Amador and Stolark said that the domestic policy environment is causing hesitation around expanding in the U.S.
“We are very much at risk of losing our US leadership position in the industry,” Stolark told me. Meanwhile, she said that Canada, China, and the EU are developing policies that are making them increasingly attractive places to build.
As Amador put it, “I think no matter what these projects will be built, it’s just a question of whether the United States is the most favorable place for them to be deployed.”
House Republicans have bet that nothing bad will happen to America’s economic position or energy supply. The evidence suggests that’s a big risk.
When President Barack Obama signed the Budget Control Act in August of 2011, he did not do so happily. The bill averted the debt ceiling crisis that had threatened to derail his presidency, but it did so at a high cost: It forced Congress either to agree to big near-term deficit cuts, or to accept strict spending limits over the years to come.
It was, as Bloomberg commentator Conor Sen put it this week, the wrong bill for the wrong moment. It suppressed federal spending as America climbed out of the Great Recession, making the early 2010s economic recovery longer than it would have been otherwise. When Trump came into office, he ended the automatic spending limits — and helped to usher in the best labor market that America has seen since the 1990s.
On Thursday, the Republican majority in the House of Representatives passed their megabill — which is dubbed, for now, the “One Big, Beautiful Bill Act” — through the reconciliation process. They did so happily. But much like Obama’s sequestration, this bill is the wrong one for the wrong moment. It would add $3.3 trillion to the federal deficit over the next 10 years. The bill’s next stop is the Senate, where it could change significantly. But if this bill is enacted, it will jack up America’s energy and environmental risks — for relatively little benefit.
It has become somewhat passé for advocates to talk about climate change, as The New York Times observed this week. “We’re no longer talking about the environment,” Chad Farrell, the founder of Encore Renewable Energy, told the paper. “We’re talking dollars and cents.”
Maybe that’s because saying that something “is bad for the climate” only makes it a more appealing target for national Republicans at the moment, who are still reveling in the frisson of their post-Trump victory. But one day the environment will matter again to Americans — and this bill would, in fact, hurt the environment. It will mark a new chapter in American politics: Once, this country had a comprehensive climate law on the books. Then Trump and Republicans junked it.
The Republican megabill will make climate change worse. Within a year or two, the U.S. will be pumping out half a gigaton more carbon pollution per year than it would in a world where the IRA remains on the books, according to energy modelers at Princeton University. Within a decade, it will raise American carbon pollution by a gigaton each year. That is a significant increase. For comparison, the United States is responsible for about 5.2 gigatons of greenhouse gas pollution each year. No matter what happens, American emissions are likely to fall somewhat between now and 2035 — but, still, we are talking about adding at least an extra year’s worth of emissions over the next decade. (Full disclosure: I co-host a podcast, Shift Key, with Jesse Jenkins, the lead author of that Princeton study.)
What does America get for this increase in air pollution? After all, it’s possible to imagine situations where such a surge could bring economic benefits. In this case, though, we don’t get very much at all. Repealing the tax credits will slash $1 trillion from GDP over the next decade, according to the nonpartisan group Energy Innovation. Texas will be particularly hard hit — it could lose up to $100 billion in energy investment. Across the country, household energy costs will rise 2% to 7% by 2035, on top of any normal market-driven volatility, according to the energy research firm the Rhodium Group. The country will become more reliant on foreign oil imports, yet domestic oil production will budge up by less than 1%.
In other words, in exchange for more pollution, Americans will get less economic growth but higher energy costs. The country’s capital stock will be smaller than it would be otherwise, and Americans will work longer hours, according to the Tax Foundation.
But this numbers-driven approach actually understates the risk of repealing the IRA’s tax credits. The House megabill raises two big risks to the economy, as I see it — risks that are moresignificant than the result of any one energy or economic model.
The first is that this bill — its policy changes and its fiscal impact — will represent a double hit to the capacity of America’s energy system. The Inflation Reduction Act’s energy tax credits were designed to lower pollution and reduce energy costs by bringing more zero-carbon electricity supply onto the U.S. power grid. The law didn’t discriminate about what kind of energy it encouraged — it could be solar, geothermal, or nuclear — as long as it met certain emissions thresholds.
This turned out to be an accidentally well-timed intervention in the U.S. energy supply. The advent of artificial intelligence and a spurt of factory building has meant that, in the past few years, U.S. electricity demand has begun to rise for the first time since the 1990s. At the same time, the country’s ability to build new natural gas plants has come under increasing strain. The IRA’s energy tax credits have helped make this situation slightly less harrowing by providing more incentives to boost electricity supply.
Republicans are now trying to remove these tax bonuses in order to finance tax cuts for high-earning households. But removing the IRA alone won’t pay for the tax credits, so they will also have to borrow trillions of dollars. This is already straining bond markets, driving up interest rates for Americans. Indeed, a U.S. Treasury auction earlier this week saw weak demand for $16 billion in bonds, driving stocks and the dollar down while spiking treasury yields.
Higher interest rates will make it more expensive to build any kind of new power plant. At a moment of maximum stress on the grid, the U.S. is going to pull away tax bonuses for new electricity supply and make it more expensive to do any kind of investment in the power system. This will hit wind, solar, and batteries hard; because renewables don’t have to pay for fuel, their cost variability is largely driven by financing. But higher interest rates will also make it harder to build new natural gas plants. Trump’s trade barriers and tariff chaos will further drive up the cost of new energy investment.
Republicans aren’t totally oblivious to this hazard. The House Natural Resource Committee’s permitting reform proposal could reduce some costs of new energy development and encourage greater power capacity — assuming, that is, that the proposal survives the Senate’s byzantine reconciliation rules. But even then, significant risk exists for runaway energy cost chaos. Over the next three years, America’s liquified natural gas export capacity is set to more than double. Trump officials have assumed that America will simply be able to drill for more natural gas to offset a rise in exports, but what if higher interest rates and tariff charges forbid a rise in capacity? A power price shock is not off the table.
So that’s risk No. 1. The second risk is arguably of greater strategic import. As part of their megabill, House Republicans have stripped virtually every demand-side subsidy for electric vehicles from the bill, including a $7,500 tax credit for personal EV purchases. At the same time, Senate Republicans and the Trump administration have gutted state and federal rules meant to encourage electric vehicle sales.
Republicans have kept, for now, some of the supply-side subsidies for manufacturing EVs and batteries. But without the paired demand-side incentives, American EV sales will fall. (The Princeton energy team projects an up to 40% decline in EV sales nationwide.) This will reduce the economic rationale for much of the current buildout in electric vehicle manufacturing and capacity happening across the country — it could potentially put every new EV and battery factory meant to come online after this year out of the money.
This will weaken the country’s economic competitiveness. Batteries are a strategic energy technology, and they will undergird many of the most important general and military technologies of the next several decades. (If you can make an EV, you can make an autonomous drone.) The Trump administration has realized that the United States and its allies need a durable mineral supply chain that can at least parallel China’s. But they seem unwilling to help any of the industries that will actually usethose minerals.
Does this mean that Republicans will kill America’s electric vehicle industry? Not necessarily. But they will dent its growth, strength, and expansion. They will make it weaker and more vulnerable to external interference. And they will increase the risks that the United States simply gives up on ever understanding battery technology and doubles down on internal combustion vehicles — a technology that, like coal-powered naval ships, is destined to lose.
It is, in other words, risky. But that is par for the course for this bill. It is risky to make the power grid so exposed to natural gas price volatility. It is risky to jack up the federal deficit during peacetime for so little gain. It is risky to cede so much demand for U.S.-sourced critical minerals. It is risky to raise interest rates in an era of higher trade barriers, uncertain supply shocks, and geopolitical instability.
This is what worries me most about the Republican megabill: It takes America’s flawed but fixable energy policy and replaces it with, well, a longshot parlay bet that nothing particularly bad will happen anytime soon. Will the Senate take such a bet? Now we find out.
Editor’s note: This story has been updated to correct the units in the sixth paragraph from megatons to gigatons.