Can Biden take credit for an ‘electric vehicle manufacturing boom’?


Good morning and welcome to The Climate 202! FYI, new episodes of the climate podcast “A Matter of Degrees” will be released starting today. Season 3 includes a “three-part miniseries on the personal, professional and political ways we can act on climate,” co-host Leah Stokes tells us.

Also today, the House Oversight and Reform Committee will hold a hearing on the fossil fuel industry’s alleged efforts to mislead the public about climate change, according to internal documents. You can tune in here at 9:30 a.m. Eastern. But first:

Can Biden take credit for an ‘electric vehicle manufacturing boom’? It’s complicated.

President Biden on Wednesday boasted that the Inflation Reduction Act, which he signed into law last month, would turbocharge domestic production of electric vehicles and the batteries that power them.

“U.S. auto manufacturers are in a position today to drive full speed ahead,” the president said during a speech at the Detroit Auto Show after test driving an electric Cadillac Lyriq across the showroom floor. “I believe we can own the future of the automobile market.”

Experts agree that the climate law will accelerate a race to make EVs and batteries in the United States, rather than rivals like China. But they say Biden cannot take all of the credit for recent multibillion-dollar investments in domestic EV and battery manufacturing, some of which predate the climate law or stem from other factors.

“He can take a little bit of credit. Not a lot,” said Sam Abuelsamid, head of e-mobility research at Guidehouse Insights. “A lot of this was going to happen anyway.”

Abuelsamid noted that automakers have been seeking to bolster domestic production of EVs and batteries for years, in part because of supply chain disruptions and the costs of shipping batteries overseas.

“The industry was already moving in this direction before Schumer and Manchin struck their deal for the Inflation Reduction Act,” he said, referring to Senate Majority Leader Charles E. Schumer (D-N.Y.) and Sen. Joe Manchin III (D-W.Va.).

Honda’s interesting timing

In a fact sheet released before the auto show, the White House outlined how companies have invested nearly $85 billion in domestic manufacturing of EVs, batteries and EV chargers since Biden took office.

The fact sheet notes that on Aug. 29 — roughly two weeks after Biden signed the climate law — South Korean battery maker LG Energy Solution and Japanese automaker Honda announced a $4.4 billion joint venture in the United States to produce batteries for Honda EVs in the North American market.

Corey Cantor, an electric vehicles associate at the research firm BloombergNEF, said the joint venture probably wasn’t motivated by the climate law.

“From the Honda announcement, it felt like that was in the works for a while,” Cantor said. “It’s not like the law was signed on August 16, and then two weeks later, they were investing in this plant.”

Marcos Frommer, a spokesman for Honda, confirmed in an email that “our discussions with LGES predate IRA.”

Still, Abuelsamid said the climate law may have accelerated those discussions. He noted that none of Honda’s EV models qualify for the law’s tax credit of up to $7,500 for new EVs. (To qualify for the full credit, an EV must be assembled in North America and its battery minerals must be sourced from the United States or its free trade partners, among other requirements.)

“I suspect that once the IRA was passed and Honda realized that none of their models would be eligible, that probably added some urgency to those conversations,” Abuelsamid said.

The White House fact sheet also highlights that Ford in June announced a $3.7 billion investment in assembly plants in Michigan, Ohio and Missouri as part of a plan to sell 2 million EVs a year globally by the end of 2026.

Joe Britton, executive director of the Zero Emission Transportation Association, said he thinks Ford and General Motors have both responded to Biden’s pro-EV policies by doubling down on their electrification plans.

In addition to the climate law, he said, both automakers have benefited from the bipartisan infrastructure law, which provided $7.5 billion for a national EV charging network, and the CHIPS and Science Act, which seeks to boost domestic semiconductor production.

However, Ford spokeswoman Artealia Gilliard said the $3.7 billion investment would have happened regardless of whether Biden was in the White House.

“This is the strategy that Ford is pursuing, no matter who’s the president,” Gilliard said. “We’re doing what we think is right for our business and what is good for the planet. And we’re going to stay that course, even if the politics of it change.”

House panel probes public relations firms over work for fossil fuel companies

Public relations firms play an active role in helping oil and gas clients spread climate disinformation and delay legislative solutions to climate change, Democrats on the House Natural Resources Subcommittee on Oversight and Investigations said at a hearing Wednesday, Valerie Volcovici reports for Reuters. 

The panel, chaired by Rep. Katie Porter (D-Calif.), released a report ahead of the hearing that detailed the tactics PR firms use to mislead the public about their clients’ climate commitments. The groups allegedly assisted fossil fuel companies by “engineering astroturf ‘citizen’ groups to advocate for industry interests and defeat legislative proposals, and using unscrupulous tactics to sabotage genuine policy solutions and attack community advocates,” the report says.

The firms Singer Associates, Story Partners and Pac/West Communications were invited to testify at the hearing but declined to attend, according to Democrats on the committee.

Republicans on the panel have pushed back against the hearing, saying issues such as advertising and public relations are not within the committee’s jurisdiction.

‘Tentative’ deal could avert rail strike that threatened coal-heavy states

The White House on Thursday morning announced it had reached a “tentative” agreement to stave off a national rail strike that had threatened the U.S. economy, The Washington Post’s Lauren Kaori Gurley and Jeff Stein report

The tentative deal, which was confirmed by a group representing freight rail operators, must still be formally ratified and the unions must still vote on it. But the White House’s blessing of the agreement suggests the worker groups have been closely involved.

No sector of the economy stands to lose as much from a potential strike as the coal industry, which is almost entirely dependent on railways to transport its product, Jake Bittle reports for Grist. A work stoppage could reduce already-thin coal stockpiles, leading to electricity shortages and soaring prices in coal-dependent states, including West Virginia and Missouri.

There are not many alternatives to rail freight when it comes to coal, which is too heavy for pipelines and takes up too much space to be moved via truck. Already, about 80 percent of utilities have said that they missed coal deliveries because of limited rail service from the labor shortage, according to a survey from the National Coal Transportation Association taken earlier this year.

E.U. proposes emergency energy measures as Russia’s war tests Europe

The European Union on Wednesday proposed emergency measures to address the energy crisis, including a windfall tax on some fossil fuel companies and binding targets to limit electricity consumption, indicating concerns that the war in Ukraine is inching the bloc toward recession, Emily Rauhala and Beatriz Rios report for The Post. 

European Commission President Ursula von der Leyen outlined the plan during the annual State of the European Union address on Wednesday. The proposal would tax the profits of non-gas power producers when they sell above a certain price point and require all fossil fuel producers to pay a “solidarity contribution” from their 2022 earnings. 

The plan, which still needs to be approved by the 27 E.U. member nations, also calls for at least a 5 percent reduction in gross electricity consumption during peak hours, when prices are expected to be the highest. 

Biden administration awards Gulf of Mexico drilling leases to oil giants

The Biden administration on Wednesday reinstated $109 million worth of leases to fossil fuel companies looking for oil and gas in the Gulf of Mexico, despite concerns about locking in planet-warming emissions for decades to come, The Post’s Steven Mufson reports. 

The Bureau of Ocean Energy Management awarded the 307 oil and gas leases as part of a compromise that won support from Sen. Joe Manchin III (D-W.Va.) for the Inflation Reduction Act, which includes about $369 billion in climate-related spending.

Lease Sale 257, which was held in November, had been invalidated by a federal judge in February. In a statement Wednesday, the bureau emphasized that the sales would “protect biologically sensitive resources, mitigate potential adverse effects on protected species and avoid potential ocean user conflicts.” 

Top Democrats including President Biden, House Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Charles E. Schumer (D-N.Y.) all supported the compromise with Manchin over the oil and gas lease sales. But some residents of the Gulf of Mexico and environmental justice activists have slammed the concession to Manchin, calling it further proof that the region is being treated as a “sacrifice zone.”

Patagonia founder gives away company: ‘Earth is now our only shareholder’

Yvon Chouinard, founder of Patagonia, announced on Wednesday that he is giving away the outdoor-apparel company, which is reportedly valued at about $3 billion — an unorthodox move aimed at combating the climate crisis, The Post’s Allyson Chiu reports.

In a letter published on the company’s website, Chouinard wrote that ownership of the company has been transferred to a trust that was “created…



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2022-09-15 05:08:44

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