Volkswagen US assembly of all-electric ID.4 flagship in Chattanooga, Tennessee in 2022.
The new Republican-majority Congress has started to make its energy priorities clear. Speaker of the House Mike Johnson said from the House floor, “We have to stop the attacks on liquefied natural gas, pass legislation to eliminate the Green New Deal. … We’re going to expedite new drilling permits, we’re going to save the jobs of our auto manufacturers, and we’re going to do that by ending the ridiculous E.V. mandates.”
However, data from the auto industry shows a more complicated story. There are more investments in EVs and related battery technologies in states under the control of Republican governors than in states run by Democrats. The top 10 states for total investments in EV technology are either solidly red or swing states such as Michigan, Arizona, North Carolina, and Nevada.
Far from helping the fortunes of automakers, Trump confidante Elon Musk is on record as saying that repealing EV incentives would be a pill he could swallow, even as CEO of Tesla, because it would hurt other automakers even more.
The Inflation Reduction Act (IRA), President Joe Biden’s sweeping 2022 law that allocates approximately $369 billion over the next decade to clean-energy and climate-related projects, has been a talking point for President-elect Trump and many members of the GOP. Not a single Republican voted in favor of the bill, saying its subsidies, tax credits, grants, and loans are wasteful government overreach.
Trump and fellow Republicans have also talked about eliminating the IRA’s $7,500 federal personal tax credit for buying a new electric vehicle, as well as various incentives for private companies investing in manufacturing solar panels, wind turbines, EV batteries, heat pumps, and other clean-energy products.
Speaker Johnson has hinted at the potential problem for the GOP now that investments have been made, and job growth continues to climb, across Republican states. He said it would be impossible to “blow up” the IRA and it would be unwise since some aspects of the “terrible” legislation had helped the economy.
Economic data shows that the IRA has given a significant boost to the economy, with hundreds of projects in states under the control of Republican governors. The IRA has created a vast portion of the clean-energy workforce, and jeopardizing their livelihoods could fuel a backlash at the polls.
Rep. Marjorie Taylor Greene, a vociferous climate-change skeptic, has yet to speak out against the IRA despite its benefits to her district, which includes the largest solar panel manufacturing plant in the western hemisphere.
Additionally, many unionized workers in the clean energy sector have spoken out against the potential repeal of the IRA, citing lost jobs and revenue. The Laborers’ International Union of North America represents about 530,000 workers in the energy and construction industries and have urged Congress not to cut the IRA.
A recent report from the Center for Automotive Research outlines the critical workforce needs to meet the demand for EV batteries, which is expected to grow six-fold in the U.S. by 2030. There are significant skills gaps in the battery industry, and workers will require increased recruitment and training to meet the demand.
The unionization of workers at battery plant factories, many of which are joint ventures located in the so-called “battery belt” that stretches from Michigan down to Georgia, is also expected to be a major issue in the coming years.