A Trump win won’t sink IRA's climate benefits, California regulator predicts

31st January 2024 By: Bloomberg

California’s top environmental regulator said it’s unlikely that the Inflation Reduction Act’s climate-focused tax credits will be undone, even if Donald Trump recaptures the White House in November.

“I think the odds of the IRA being repealed are pretty small,” said California Air Resources Board (CARB) chair Liane Randolph on Tuesday at the BloombergNEF Summit in San Francisco. “Some of the basic federal support we’ve done for climate action will continue, and I think that’s very important.”

President Joe Biden’s signature climate law, known as the IRA, offers tax incentives for the deployment of, among other technologies, solar farms, wind turbines and green hydrogen. It also offers tax credits that individuals can take advantage of for electric cars, heat pumps and other technologies. The IRA is estimated to provide an estimated $1.2-trillion of incentives by 2032, creating the most supportive regulatory environment in clean tech history, according to Goldman Sachs research. It has already had an impact, with drivers turning towards EVs in part due to the law’s $7 500 tax credit for EVs and automakers onshoring manufacturing in response to the law’s increasingly stringent requirements for American-sourced materials.

Trump has criticized Biden’s climate measure on the campaign trail and his advisers have said he would move to roll it back if he wins the election this year. Republicans in Congress have also expressed a desire to undo the law as well, and the conservative-controlled House has already tried to do so more than 30 times, according to advocacy group Climate Power. Despite Republican opposition, red states are poised to reap the biggest rewards from the IRA.

California has set some of the most ambitious climate goals in the nation, including a plan for the state’s economy to be carbon neutral by 2045. To get there, the state will effectively ban the sale of new fossil fuel-powered cars by 2035 under rules developed by Randolph’s CARB. California has been able to regulate car pollution under a federal waiver, which Trump attempted to revoke during his presidency.

Randolph said the state would continue to push ahead with its climate goals, no matter the presidential election outcome.

“We will do all we can, no matter what happens, to continue the work were doing,” she said.