4 takeaways from POLITICO’s Energy Summit

By Jason Plautz, Brian Dabbs, Zach Bright | 06/06/2024 06:23 AM EDT

White House officials, industry leaders and Republicans debated how the election could change the energy sector.

Energy Secretary Jennifer Granholm speaks Wednesday at the POLITICO Energy Summit.

Energy Secretary Jennifer Granholm speaks Wednesday at the POLITICO Energy Summit. POLITICO

Senior administration officials, Republican lawmakers and company officials offered sharply divergent views Wednesday on the fate of the Inflation Reduction Act that is funneling billions of dollars into the energy sector.

At POLITICO’s Energy Summit, national climate adviser Ali Zaidi, Energy Secretary Jennifer Granholm, White House senior adviser Tom Perez and other top administration officials said it’s clear that investments from the IRA — and other massive spending bills passed under Presiden Joe Biden — are cutting greenhouse gas emissions and building a new energy workforce.

But polling has shown that many Americans are unaware of the climate law’s provisions and the administration’s efforts to implement it.


Former President Donald Trump — who has called the IRA a “scam” — is vowing to roll back clean energy policies and ramp up drilling if elected.

At the summit, Sen. Cynthia Lummis (R-Wyo.) said she’d like to take any unspent climate money and tuck it away for Social Security. Other Republicans like Rep. Andrew Garbarino (R-N.Y.), however, said that many IRA provisions have GOP support.

The debate comes as some environmentalists have been critical of Biden’s record in approving fossil fuel projects.

With electricity demand rising and the impacts of climate change accelerating, the November election could determine the pace of government spending on energy technologies ranging from solar panels to low-carbon hydrogen.

Here are four takeaways from the summit:

Trump predictions

Looming over the summit was news that the youth-led Sunrise Movement is withholding support for Biden partly because of the administration’s support of domestic fossil fuel production.

Democrats emphasized that while Biden has committed to a carbon-free grid by 2035 and halving U.S. emissions this decade relative to 2005 levels, implementing those policies take time. Zaidi said that while he understood the frustration from youth voters, a Trump win on Nov. 5 represents a “U-turn agenda.”

Tom Pyle, the president of the conservative American Energy Alliance, said he expected Trump to “claw back” any unspent funds from the IRA to spend on his priorities, while also gutting “legally questionable and economically harmful” environmental regulations. Pyle, a member of Trump’s transition team in 2016, said that voters want “choice” in what energy they use for their homes or cars. Trump, he said, would be in position to work quickly if elected to overturn so-called energy mandates.

Betamia Coronel, senior national organizer for the activist group Center for Popular Democracy, said a Trump reelection could be “quite apocalyptic.” Tackling climate change, Coronel said, means the nation needs to “completely transform the way our economy functions” and gutting the IRA “would be a huge setback.”

Still, Coronel said that her group and others on the left are still hoping to hear more from Biden. More fossil fuel burning, she said, could offset the IRA’s benefits, so Climate Justice would like to see an “immediate phase-down and phase-out” of oil and gas.

It’s unclear how much climate change and energy policy will move swing voters in the election, said Jon Krosnick, a Stanford University professor of political science. Young people disappointed by Biden’s policies “will probably not turn to Trump,” but they may not be motivated to vote at all, he said.

Zaidi said he empathized with the urgency felt by young voters who have grown up seeing the effects of climate change. He said it is also important to keep oil and gas prices low for people who still rely on fossil fuels for existing cars and infrastructure.

The White House is figuring out “how we accelerate the clean energy transformation while maintaining stability for consumers, especially low- and moderate-income folks” during the energy transition, he said.

Biden officials defend the climate law’s pace

Biden officials said IRA investments are boosting U.S. economic activity, even if many projects are not operational yet and the process to distribute awards has sometimes gone slowly.

“It won’t happen overnight,” said Granholm, noting she has been to a few groundbreakings but not many ribbon cuttings because it takes a while to build factories with funds distributed by the law.

“You talk to the building trades, they have never seen so much work. … But people aren’t necessarily being hired for those particular sites yet,” she said. She cited challenges such as states not having enough staff to process applications for federal funding.

At the same time, she said that progress is being made. The Department of Energy is providing technical assistance to states that have applied for energy rebates, with announcements coming this summer, she said.

It would be “political malpractice” for Republicans to repeal the climate law, which is producing jobs in GOP-dominated states, she said.

Zaidi also said clean energy investments are here to stay. “You’re not going to drive around America trying to pull out the 185,000 charging stations that now line our roads and highways,” he said.

Treasury Deputy Secretary Wally Adeyemo said that his department has so far issued more than 60 pieces of guidance related to the IRA so that companies and taxpayers could take advantage of its provisions.

One crucial guidance that will soon be finalized, he said, offers additional tax breaks to clean energy developers who pay their workers a prevailing wage and hire apprentices. The administration also is prepping rules for tax credits for electric vehicle infrastructure, he said.

“When President Biden thinks climate change, he thinks good jobs,” Adeyemo said. The IRA’s language on wages, labor and domestic manufacturing, he said, are “trying to align incentives in the right way” to make sure workers benefit from the clean energy transition.

Granholm also urged congressional action to speed up permitting for energy projects, saying forecasts on future electricity demand because of data centers and other factors are a “little overhyped.”

“We have the tools to be able to address this,” she said, referring to technologies such as so-called virtual power plants that can increase efficiency.

Federal Energy Regulatory Commission Chair Willie Phillips also said data centers, artificial intelligence and greater electrification of homes and vehicles are “putting pressure on our system.”

“We have to act now if we’re going to have a reliable system in the future,” Phillips said.

Wall Street looks for certainty

Wall Street investors, meanwhile, said the federal government needs to work faster on implementation of the IRA and other laws.

Regina Mayor, the global and U.S. head of energy at KPMG, called the IRA’s benefits “incredibly complicated,” adding they are “not having the sea change at the investor level that I think we would like it to catalyze more of.”

George Bilicic, the managing director of global financial services firm Lazard, said looming guidance for “clean” hydrogen tax credits under the IRA needs to be clarified by the Treasury Department if the administration hopes to build up the industry.

Sam Mar, senior adviser for philanthropy group Arnold Ventures, said Congress has more to do beyond putting dollars into more clean energy.

“It’s time to look ahead at what’s next in terms of what Congress can do to further accelerate this transition,” Mar said. “To us, that means permitting reform.”

Nonetheless, investors at the summit said they aren’t expecting the IRA to go away anytime soon.

Mayor called the climate law a “a very, very positive step forward,” adding that “the word on the street from the investor community and the energy industry is it’s here to stay.”

“It makes sense to me that it would survive — it’s benefiting all sorts of different parts of the country,” said Bilicic.

The U.S. grapples with its global role

Adeyemo also defended tariffs announced by the administration last month that will raise the price of importing Chinese electric vehicles, advanced batteries, solar cells and other materials. China, he said, was subsidizing companies to overproduce those products and creating an “unlevel playing field.”

The combination of the tariffs and incentives in laws like the IRA that encourage companies to source materials domestically, he said, are designed to encourage an American supply chain and help the U.S. “compete with companies abroad.”

Adeyemo added that an ongoing investigation by the European Union into the impact of Chinese electric vehicles and a May statement by G7 countries warning of Chinese oversupply of EVs and other products shows that U.S. allies are becoming increasingly concerned about the Asian country’s market influence.

Rahm Emanuel, the former White House chief of staff and current ambassador to Japan, rebuffed concerns that the administration’s current pause on liquefied natural gas export projects would hurt the country’s standing. Japan is the world’s second-biggest buyer of the fuel and officials there have said that delays in new export projects could challenge their economy.

Emanuel, however, said the U.S. is “here to partner with [Japan] on research projects” that can expand use of the country’s idled nuclear power plants and develop more renewable energy, part of the administration’s work to encourage allies on an energy transition.

Earlier in the day, Granholm reiterated that DOE is planning to wrap up the contested pause — which was implemented in January — by early next year.

DOE is now conducting an economic and climate analysis on LNG that will help inform future decisions to approve or deny exports. Granholm said that review would be complete likely by the end of the year. The total process will be done in the first quarter, she said.

“Nobody who is exporting is affected by this pause. … Nobody whose project has been authorized is affected by this pause. Those can all go forward,” Granholm said.

This story also appears in Climatewire.

Correction: A previous version of this story misstated Betamia Coronel’s affiliation.