Kate Huangpu of Spotlight PA
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HARRISBURG — As a new presidential administration prepares to take power, people involved in fledgling clean energy projects in Pennsylvania say they’re watching closely for policy changes that could hamstring their funding or make the initiatives less environmentally friendly.
On the campaign trail, President-elect Donald Trump promised to repeal the Inflation Reduction Act, a marquee Biden administration policy. Climate scientists and economists say the law will drastically reduce carbon emissions over the next decade and mitigate the impacts of climate change.
The federal government is slated to send Pennsylvania billions of dollars for projects like producing hydrogen, installing solar panels, and incentivizing demand for electric vehicles. The law also creates rebates and tax credits for consumers to lower energy costs and make their homes greener.
“To further defeat inflation, my plan will terminate the Green New Deal which I call the Green New Scam,” Trump said during a speech at the Economic Club of New York two months before the Nov. 5 election. It will “rescind all unspent funds under the misnamed … Inflation Reduction Act.”
People involved in energy policy are also monitoring programs funded by the federal Infrastructure Investment and Jobs Act. That law funds the plugging of abandoned oil and gas wells in Pennsylvania, many of which emit methane — a potent greenhouse gas that speeds up global warming. The wells can also leach chemicals into nearby water supplies.
The Biden administration has made hydrogen hubs the centerpiece of its climate policy. These planned networks of facilities would produce, store, and transport hydrogen, a clean-burning fuel that supporters say will be useful for decarbonization.
Two hubs are being built partly in Pennsylvania, and are scheduled to receive $1.6 billion over the next decade.
Representatives for one of the hubs told Spotlight PA that initial funding for the project, which will primarily be used for planning, is secure. Trump can’t do anything about money that has already been authorized for these projects, and the incoming president will need congressional approval to repeal the IRA or redirect future funds. Funding won’t be released until a contract describing the framework for proceeding is signed with the Department of Energy.
The representatives declined to comment on whether the project would continue should some of the federal money disappear.
“It has been heartening to hear President Trump express his commitment to new jobs and initiatives that will help drive forward projects, like clean, locally produced hydrogen, which will strengthen America’s energy portfolio and security,” said Manny Citron, a vice president at the Mid-Atlantic hydrogen hub, or MACH2, which is being built in Southeast Pennsylvania.
Also at risk are tax credits to incentivize companies to produce clean hydrogen, aviation fuel that emits less greenhouse gases, and more. Environmental advocates say the Trump administration could write guidance that weakens the climate and labor standards that companies, individuals, or other entities must meet.
Another possibility, though less likely, is that Trump could completely eliminate tax credits or end grant programs funded by the IRA. He would need congressional approval to do so, and the cuts would likely be specific rather than a blanket repeal. But with Republicans controlling Congress, advocates have said that such a move is not off the table.
Katie Blume, legislative director for Conservation Voters of Pennsylvania, singled out two income-restricted rebates that will allow homeowners to update boilers, heating and cooling systems, and other appliances and infrastructure to make their homes more energy-efficient.
“A lot of the rebates and tax credits that are helping everyday Americans are the things that I’m worried about,” Blume said.
Justin Balik, senior state program director at the national climate advocacy group Evergreen Action, said he’s keeping a close eye on IRA programs that are particularly climate-focused, like Community Change Grants for places the federal government designates as “disadvantaged.”
Pennsylvania initiatives already selected for funding include upcycling urban tree waste, and creating a training program for clean energy jobs like solar construction and HVAC repair.
The EPA said it will authorize funds for the program through the end of the Biden administration, leaving a portion of the funds under Trump’s control. Once in office, he would be able to pause spending that was mapped out by the IRA, but that hasn’t yet been officially authorized.
“Anything that screams environmental justice or equity will have a target on its back,” Balik said.
Balik added that he’s also keeping an eye on how Trump’s appointees to the U.S. Treasury may rewrite or amend guidance for claiming federal tax credits.
“It’s not like these things can change overnight,” Balik said. “They’re not going to be able to wholesale rewrite the IRA tax credits and what their purpose is … but I’m sure they’ll try to bend guidance to their will.”
For example, an IRA-created tax credit incentivizes the production of “clean” hydrogen. Current guidance limits the credits to hydrogen producers with emission levels that are only achievable through the use of renewable energy. However, the new administration could adjust those rules and categorize hydrogen fuel produced using natural gas as “clean,” despite its higher emissions.
Such changes would affect states as well as companies and consumers. The Pennsylvania legislature has passed a host of energy-related laws that seek to capitalize on federal tax credits.
One creates the administrative framework for the fledgling carbon capture industry, wherein emissions are captured before escaping into the atmosphere and injected into deep underground wells. In an interview before the bill’s passage last June, state Sen. Gene Yaw (R., Lycoming) told Spotlight PA that the legislation will help lay the foundation to claim federal funds for hydrogen hubs.
“We have to indicate our interests,” said Yaw, its primary sponsor. “The net result, hopefully, if we get to the hydrogen hub, will be that we will get significant amounts of support and money.”
Pennsylvania lawmakers also approved a $25 million Solar for Schools grant program. It’s built with the assumption that projects will qualify for some federal money, and that between the state and federal support, the efforts will be affordable or free for schools.
Even without federal funding, the state program will still serve the energy and economic needs of a school district, said Daisy Confoy, a spokesperson for state Rep. Liz Fiedler (D., Philadelphia), the prime sponsor of the legislation that created the program.
Still, she told Spotlight PA that losing federal funding could make the grants go underused.
“There might be fewer opportunities to couple federal funds and federal incentives, but there are some things that remain unchanging,” Confroy said. “We’re going to need more energy. We’re gonna need more jobs. People are going to be calling about clean air and clean water.”
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