For example, in December 2023 we learned how restrictions in the EV tax credits will affect vehicles with components made in China. As a result, starting in 2024 some vehicle models became ineligible for the credits, including the Ford Mustang Mach-E. (The company hasn’t said exactly why the model lost eligibility, but some reporting has suggested it’s likely because the lithium iron phosphate batteries used in the vehicles come from the Chinese company CATL.)
Some of those specifics get really complicated. The hydrogen tax credits could get tangled up in legal battles. The full rules on credits for sustainable aviation fuel raised concerns that fuels that don’t help much with emissions will still get funding. The credits for critical minerals apply only to processing, not to mining efforts, as my colleague James Temple detailed in his story about a Minnesota mine earlier this year.
Looking ahead, the fate of the IRA’s programs may depend on the outcome of the presidential election in November. Vice President Kamala Harris, the Democratic nominee, cast the tie-breaking vote to pass the law, and she would likely keep the programs going. Meanwhile, Donald Trump, the Republican nominee, has been openly targeting many of its provisions, and he could do some damage to many of the tax credits included, even though it would require an act of Congress to actually repeal the law. (For more on what a second Trump presidency might mean for the climate law, check out this great deep dive from James Temple.)
The action certainly isn’t slowing down in the world of climate technology. Looking ahead, one major piece of the puzzle we’ll be watching is a potential change to how new projects get approved. There’s a permitting reform package winding its way through the government now, so stay tuned for more on that, and on everything climate tech.
Related reading
At our ClimateTech event last year, Leah Stokes, an environmental policy professor at UC Santa Barbara who was closely involved with developing the IRA, spoke with us about the law. For more on how it came to be and what changes we’ve seen so far, check out her segment here.
