The carriage is about to turn back into a pumpkin. But before it does, the ballroom is alive with the sounds of dancing.
It has been a Cinderellian four years for clean energy in the United States. The Bipartisan Infrastructure Law, the CHIPS and Science Act, and the landmark Inflation Reduction Act (IRA) have leveraged grant and loan programs, tax credits, and other policies to catalyze more than $1 trillion in manufacturing, infrastructure, and clean energy investments since Joe Biden took office. As a result, communities from coast to coast are getting much-needed electric infrastructure upgrades, global companies are setting up shop to build important stuff, and we’re even making solar cells stateside again.
Now, in the twilight hours of Biden’s watch, the feds are hustling to clean out the cupboards, allocating as much remaining IRA funding as possible to keep its fate out of the hands of Donald Trump.
Trump, who will be inaugurated on January 20, has taken a variety of anti-clean energy stances, particularly rallying against wind power, decreeing “no new windmills” would be built during his second stint in the White House. Trump campaigned on dismantling what he deems “the green new scam,” and has said it would “be an honor” to rescind any unspent funds promised to climate and cleantech initiatives. That may not be popular amongst many of his constituents, considering more than 75% of the $160 billion in privately-led clean energy and manufacturing projects supported by the IRA are in Republican-held districts, creating at least 166,000 new jobs.
And federal funding that has already been assigned will be difficult (or impossible) to recall, giving the Biden Administration impetus for greenlighting as many important projects as possible before metaphorical midnight. According to data from Atlas Public Policy, about $74 billion of the money made available by the IRA has been dispatched, leaving roughly $20 billion at risk across about 20 different programs.
The latest investment in rural America
Last Friday, Agriculture Secretary Tom Vilsack unveiled the latest windfall of $6 billion through the U.S. Department of Agriculture’s (USDA) Empowering Rural America (New ERA) and Powering Affordable Clean Energy (PACE) programs. Rural electric cooperatives and communities will use the funding to support thousands of jobs, lower electricity costs for businesses and families, and reduce climate pollution by millions of tons each year. More than one in five rural Americans will benefit from clean energy investments supported through the New ERA and PACE programs.
Nearly $5.5 billion in New ERA grants and loans will finance 28 clean energy projects in Alabama, Alaska, Arizona, Colorado, Georgia, Idaho, Kansas, Kentucky, Louisiana, Maine, Minnesota, Mississippi, New Mexico, North Carolina, North Dakota, Ohio, South Carolina, Tennessee, Virginia, Washington and Wisconsin. Inside Passage Electric Cooperative will build a run-of-river hydropower facility in a remote Alaska community; Green River Energy plans to create 1,600 jobs and procure more than a gigawatt of solar and wind projects; Seven States Power Corp. is eyeing a massive solar facility in the deep south.
USDA estimates it has awarded around 90% of the total available New ERA funding to benefit rural electric cooperatives and their members, obligating approximately $9 billion of the program’s $9.7 billion budget authority. This represents more than $14.5 billion in grants and loans benefiting 35 states, with rural electric cooperatives committing to build or purchase more than 13 gigawatts of clean energy.
USDA has also promised more than $1.6 billion in partially forgivable PACE loans, including approximately $565 million in its latest drop that will finance 26 clean energy projects in Alabama, Arkansas, Arizona, Colorado, Florida, Illinois, Indiana, Iowa, Kentucky, Louisiana, Michigan, Nebraska, North Carolina, Oregon, Virginia, Washington and Wyoming. The Navajo Tribal Utility Authority is eyeing solar and battery deployment in the southwest; Tri-County KY Affordable Solar LLC will develop a solar power system to serve 20,000 homes; In rural Michigan, Electric City ESS LLC will supplement existing utility solar and hydropower sources with a 10-megawatt battery energy storage system.
What will survive?
Some believe Trump will be more likely to take a “scalpel rather than a sledgehammer” approach to handling the IRA, considering how much the wide-ranging legislation has benefitted Republican districts. The $7,500 electric vehicle tax credit seems ripe for the picking, but Trump should think twice before unwinding recent domestic manufacturing growth, a sentiment shared in a frequently-publicized letter drafted for House Speaker Mike Johnson by 18 Republican members of Congress last year.
In his final foreign policy address, President Biden called climate change “the single greatest existential threat to humanity” and warned China is poised to dominate the global clean energy market if the U.S. reverses course when Trump retakes office.
That doesn’t sound like something Trump would want to happen, does it?
Who knows- perhaps he will discover the glass slipper of “clean energy investments” also fits the foot of “domestic manufacturing growth and energy dominance.” In that case, the dance might continue, albeit to a slightly different beat.
