In the wake of the 2024 election results, Logisticus Group is actively tracking President-Elect Trump’s priorities as they relate to the Inflation Reduction Act. With the full control of the White House and the Congress resting in the hands of the GOP, the future of the IRA is very much in jeopardy.
“A critical test for Trump would come if he tries to scrap the 2022 Inflation Reduction Act, with its grants and long-term tax incentives for wind, solar, utility storage batteries, transmission lines and EVs. Republican support for new clean energy manufacturing operations could stymie spending clawbacks, but Trump’s administration could halt new grants and weaken incentives with changes in tax regulations, his advocates say.”
https://www.eenews.net/articles/trump-victory-rattles-us-energy-policy/
All indications are that the IRA will face a partial repeal. What key provisions stay or go, may well depend on how hard the 14 GOP Representatives mentioned below and how hard they are willing to push on their party’s leadership in the House.
“Rep. Andrew Garbarino(R-N.Y.) vowed Wednesday that the Republicans who signed onto a letter he led warning against repeal of the Inflation Reduction Act’s clean energy tax credits won’t back down when Trump becomes president next year.
Garbarino noted that 14 of the 18 Republicans who signed onto the letter will remain in the House next year — enough to stop the gutting of IRA tax credits given the GOP’s expected single-digit majority.
“You are seeing heavy investment in Republican states that Trump just won,” Garbarino told our Josh Siegel on Wednesday. “And, by the way, in his [campaign] messaging, Trump was appealing to a lot of those union, independent voters who support a lot of those tax credits. A lot is thrown out there in campaign rhetoric, but then when push comes to shove and you’ve got to look at where you are seeing investment…we’ve got to get it right.”
Garbarino, who is co-chair of bipartisan Climate Solutions Caucus, dismissed “skeptics” who doubt that moderate Republicans will hold the line if Trump pushes to repeal IRA credits as a potential revenue source to extend the 2017 tax cuts through a reconciliation package early next year.
“They say a lot of shit they’re wrong on,” Garbarino said. “There are people who care about this very much. They weren’t all marginal members. They are members in conservative districts.”
Garbarino said he’s confident Speaker Mike Johnson is sensitive to their concerns and is communicating that to Trump as they discuss the incoming administration’s agenda for his first 100 days, noting Johnson’s comments about planning “to use a scalpel and not a sledgehammer.”
“There will be and are discussions going on as to what people want to see stay, what has worked and what hasn’t worked [in the IRA],” he said.
However, most predict that the House and Senate GOP Leadership will ultimately push their Caucasus to fall in line with the priorities of the incoming Trump Administration.
“With Republicans securing control of the House, Senate and White House in the election, they are poised to claw back major legislation Democrats have passed to fight climate change.
Chief in the GOP’s crosshairs are provisions of the Inflation Reduction Act — a massive climate, tax and health care package that contains hundreds of billions of dollars worth of tax credits for renewable energy, electric vehicles, domestic manufacturing, nuclear power, biofuels and more and was projected to deliver serious reductions in planet-warming emissions.
While a handful of Republicans have indicated they don’t want to eliminate all the law’s incentives for low-carbon energy, some, like subsidies for electric vehicles, could be on the chopping block.
There is also concern about how Trump’s tariff policy will impact materials related to wind and solar deployment.
Trump Allies Lay Groundwork for Massive New Tariffs
“President-elect Donald Trump’s former trade chief and those close to him are preparing to aggressively sell their plans for massive new tariffs on imports that will go far beyond anything seen in Trump’s first term,” Politico reports.
“Robert Lighthizer, a gruff, Ohio-born trade lawyer, and his allies have been circulating memos among themselves as they prepare to convince lawmakers and the public that their plans for dramatically higher tariffs will energize the economy instead of tanking it.”
“Advisers close to Lighthizer and the Trump transition also have been talking to key lawmakers and congressional staff about how Congress might even take a role in imposing the incoming administration’s tariff plans through legislation — an action that would signify a break from mainstream economic policymaking embraced by both parties for decades, but would also prevent the tariffs from being unilaterally revoked by a future president.”
https://www.wsj.com/articles/clean-energy-investors-brace-for-new-risks-under-trump-269d2e1d
Clean-Energy Investors Brace for New Risks Under Trump Potential new tariffs on clean-energy equipment and a repeal of industry tax incentives may require rethinking project economics
A new Trump administration may raise supply-chain and regulatory risks for clean-energy investors, but that won’t derail investment opportunities in the industry and credit deals in particular, according to investment executives.
Wind- and solar-power project developers and the investors who back them could face hurdles if Donald Trump makes good on promised tariffs on imported clean-energy equipment and the elimination of industry tax incentives, speakers said during a panel discussion Monday at the SuperReturn Energy investment conference in New York.
The first 100 days of the new Administration will be a critical period for the future of the Inflation Reduction Act as well as the supply change of renewable energy materials. LG will be monitoring all of these developments and their impact on our customers.