For example, in December 2023, we learned how restrictions on electric vehicle tax credits will affect vehicles with components made in China. As a result, starting in 2024, some vehicle models will no longer be eligible for the credits, including the Ford Mustang Mach-E. (The company hasn’t said exactly why the model is no longer eligible, but some reports suggest it’s likely because the lithium iron phosphate batteries used in the vehicles come from Chinese company CATL.)
Some of these details are really complicated. The hydrogen tax credits could get embroiled in litigation. The full rules for sustainable aviation fuel credits raised fears that fuels that do little to reduce emissions would still be promoted. The critical minerals credits only apply to processing, not mining, as my colleague James Temple detailed in his report on a Minnesota mine earlier this year.
The fate of the IRA programs going forward may depend on the outcome of the November presidential election. Vice President Kamala Harris, the Democratic nominee, cast the deciding vote to pass the bill and would likely keep the programs going. Meanwhile, Donald Trump, the Republican nominee, has openly targeted many of the provisions in it and could damage many of the tax credits it contains, although it would take a legislative act from Congress to actually repeal the law. (For more on what a second Trump presidency could mean for the climate bill, see this in-depth report by James Temple.)
Things are definitely not getting quieter in the world of climate technology. One important piece of the puzzle that we will be watching in the future is a possible change in the approval processes for new projects. A package of approval reforms is currently being worked on by the government, so stay tuned to hear more about this and everything related to climate technology.
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At our ClimateTech event last year, Leah Stokes, a professor of environmental policy at UC Santa Barbara who was closely involved in the development of the IRA, spoke to us about the law. For more information on how it came about and the changes we’ve seen so far, check out her post here.
