As the Biden Administration works swiftly to implement the trifecta of transformative legislation passed in the last three years – the Bipartisan Infrastructure Law (BIL), CHIPS and Science Act, and Inflation Reduction Act (IRA) – the prominent question on the minds of many is how will the election impact its progress. Though it is undeniable how much has been done to advance clean energy projects of all shapes and sizes, considerable work remains to successfully spur a comprehensive clean energy transition and regain U.S. energy leadership. The election will impact the pace at which success of these policies, programs, projects and overall congressional objectives is achieved.
The U.S. Department of Energy (DOE) recently announced that all BIL and IRA funds have been launched, meaning there is a plan in place to issue funding opportunities for all remaining programs and accounts. Most of these funding opportunities were brand new, such as the Hydrogen Hubs and the Transmission Facilitation Program. However, of those programs that have been competitively reviewed and selections made, there is still significant work to be done in realizing the full value of these investments. Both administrations would benefit from ensuring the success of these programs, which can drive job creation and U.S. innovation that's currently underway.
Harris-Walz Administration
In a potential Harris-Walz Administration, as anticipated, it is very likely to see continued execution of the BIL and IRA endeavors. This includes an even stronger investment in "community benefits" plans to support the energy transition. Another major focus will be on capital formation for clean technology through leveraging the federal government to accelerate private-sector investment. The DOE recently announced a new initiative, the Manufacturing Capital Connector, intended to connect companies applying to DOE clean energy manufacturing programs to capital providers seeking high-quality projects. Programs like this will help to crowd in resources needed to stretch federal dollars and support the clean energy transition. Additionally, a Harris-Walz Administration would continue efforts around workforce development to serve the new industries that are being established, including battery manufacturing, processing and recycling, and direct air capture. Lastly, a Harris-Walz Administration is likely to continue addressing permitting challenges through direct community outreach and engagement with congressional support. Furthermore, Congress will likely be called upon to help smooth the edges on deployment in line with congressional intent, supplement existing programs to meet existing and expanded clean energy transition investments, and ensure projects meet their milestones and achieve intended results.
Trump-Vance Administration
In a potential Trump-Vance Administration, it will be imperative to engage Congress to defend programs and projects from rollbacks and recissions. Although it has pivoted at times, the Trump campaign has broadcast its intent to roll back the BIL and IRA. Though not directly connected to the campaign, Project 2025 proposes to "eliminate special interest funding programs" such as the Office of Clean Energy Demonstrations and Loan Programs Office (LPO). For companies and communities that are the beneficiaries of programs, it is imperative that they work with both the DOE and Congress to ensure the awards remain active and viable. In 2016, many clean technology investors were slow to become engaged and pivoted their focus to efforts at both the state level and abroad, which eventually proved insufficient. Fortunately through strategic engagement and significant Congressional lobbying – especially for programs such as LPO – programs that were originally on the chopping block were brought back to life through both Congress and the Trump Administration. Notably in 2020, the Trump Administration issued Executive Order 13817 that expanded the Advanced Technology Vehicle Manufacturing (ATVM) Loan Program to allow for the support of onshoring energy supply chains. Though this program had initially been defunded in annual appropriations, the Trump Administration came around once it realized the critical value it possessed and its capacity to further U.S. competitiveness. With billions of dollars likely to still be available in 2025, the ATVM program remains a strategic tool for the U.S. government as it works to onshore a secure resilient supply chain and continues to ensure the U.S. gains a competitive edge against China.
Divided Government
In either scenario, Congress will remain essential to ensuring the overall success of BIL and IRA investments and addressing outstanding needs that still exist after programmatic deployment. Even Republican House members are signaling that a sweeping repeal of the IRA tax credits is not preferred. In August 2024, 18 Republicans wrote to House Speaker Mike Johnson (R-La.) saying that repealing the credits could undermine growth in the energy sector. Energy grants, loans and tax credits have spurred innovation, incentivized investment and created hundreds of thousands of bipartisan jobs across the country. Revoking these programs just as benefits begin to materialize is hopefully not going to be an easy proposition.
The programs created have been widely popular and well received within the U.S. market. The oversubscription highlights their popularity and immense demand, with applications in many cases exceeding available capacity by more than tenfold. For example, the DOE received 79 concept papers for Hydrogen Hubs, encouraged 33 to submit full applications and ultimately funded seven projects.
Similarly, the DOE reviewed 411 concepts across all subsectors for industrial decarbonization, and these projects requested more than $60 billion in federal funds – 10 times the amount Congress appropriated for the program. The DOE encouraged 130 to submit full applications and selected 33 to proceed to award negotiations.
Programs aimed at enhancing grid flexibility and resilience of the power system against growing threats of extreme weather and climate change are equally oversubscribed. In the first solicitation, the DOE received more than 300 applications requesting over $19 billion – five times more than the $3.5 billion available for selected projects. Interest is evident from the private sector and, depending on the balance of power in Congress, further support for these investments may be pursued to sustain momentum and to bolster U.S. development.
Both parties have become increasingly concerned and engaged on issues related to countering China's influence, mainly addressing these concerns by shoring up domestic energy supply chains. There is growing support for government interventions to bolster the critical minerals industry, which is as essential to the clean energy transition and U.S. manufacturing.
It has been reported that efforts being considered within the Biden Administration, as well as on Capitol Hill to establish demand-side price supports for critical mineral projects are being undercut by cheaper Chinese materials. A price floor for critical minerals would cover the difference between the products, helping U.S. companies weather the unstable markets impacted by manipulation. The House Select Strategic Competition between the U.S. and Chinese Communist Party has made similar recommendations regarding a "Resilient Resource Reserve" for critical minerals in their December 2023 report. This policy has also garnered interest from DOE officials who have acknowledged the adverse impact on the industry and are committed to mitigating these effects. They view this intervention as a targeted but temporary measure designed to stabilize the market during a critical phase of development, ensuring a smoother transition to a self-sustaining ecosystem. The Harris campaign has also expressed interest and support for this policy, framing the issue as an "economic and national security" necessity to counter China's dominance in electric vehicles (EVs) and clean energy supply chains. Demand side tools could be used for price-sensitive commodities – including clean steel, aluminum and cement – to help derisk project development to attract private financing.
Additionally, Sens. John Hickenlooper (D-Colo.) and Thom Tillis (R-N.C.) have been working across the aisle to creatively support responsible domestic mining efforts. They have introduced two bills targeting the domestic mining industry, offering research and development support, and spearheading the development of a national strategy to meet the growing demand for critical minerals. In the House, Reps. Paul Tonko (D-N.Y.) and Garrett Graves (R-La.) introduced bipartisan legislation aimed at enhancing transparency in critical materials. The Critical Material Transparency and Reporting of Advanced Clean Energy (Critical Material TRACE) Act proposes the establishment of a DOE program to implement digital identification systems for battery materials.
Regardless of the majority party in either chamber, there is no doubt that addressing the challenges of critical minerals will remain a priority. This focus will require continued investment, collaboration and input from stakeholders to develop sustainable solutions that support resilient supply chains for energy security.
Insights
It has become increasingly evident that to ensure the overall success and continuation of the BIL and IRA programs and projects, ongoing executive branch and congressional engagement will be essential for achieving success in the clean energy transition and maximizing opportunities with the federal government.
