Republicans try to unplug the EV era

Politico

23-05-2025

Remember how the government was going to help America become an electric vehicle superpower? On Thursday, Congress said that's over.
The Republican message was crystal clear. The Senate voted to kill the waiver that California relied on to require a giant ramp-up of EV sales. Meanwhile, the House passed a budget reconciliation bill that would methodically destroy the incentives that the Biden administration had used to support EVs, as I wrote today.
Depending on one's view, these actions amounted to a correction of Democrats' meddling in the auto market, or a historic retreat from leadership in climate-friendly technology.
Big U-turnThe killing of the waiver created a surge of relief among automakers and dealers, who saw California's Advanced Clean Cars II rule — adopted also by 11 other states — as requiring automakers to produce far more EVs than customers are now interested in buying.
The House's rollbacks didn't evince that kind of celebration. The politics are trickier. Automakers, after all, have invested billions of dollars to produce EVs, assuming the government would have their back by offering tax breaks for vehicle purchases and battery factories.
America's EV sales declined last month, according to Cox Automotive. Nonetheless, automakers presume that interest will rebound as batteries get cheaper and charging stations become more common. That job becomes harder if the House gets its way and ends tax breaks —for batteries and charging stations.
A crucial part of the House bill reflects sharp partisan differences in strategy over China.
The House essentially voted to forbid Chinese content in EV batteries. That's a departure from the Biden approach, which was to require less Chinese content each year, stepping up domestic capacity while weaning off China as the globe's overwhelmingly dominant battery supplier. The approach that Republicans adopted — more of a crash diet — 'undermines efforts to build robust, secure and reliable access to critical minerals,' said Ben Prochazka, the executive director of the Electrification Coalition, a pro-EV nonprofit.
Still not the end of the road? Nothing that happened Thursday is the last word. California immediately went to court to challenge the Senate's reversal of California's waiver. And the Senate counts some Republicans who object to voiding EV subsidies, because that would forestall new battery and automaking jobs back home.
Meanwhile on Thursday, a different Trump-inspired campaign against EV subsidies took an intriguing turn.
The Government Accountability Office, a nonpartisan arm of Congress, accused Trump's Department of Transportation of acting illegally when it shut off states' access to $5 billion in congressionally approved money for building EV charging stations.
Trump's budget chief dismissed the GAO finding as a 'non-event,' but it could preview a conflict down the road if Congress takes umbrage at Trump usurping the legislative branch's spending decisions.
'It could be that this is one of the programs that brings a crazy battle between the executive branch and what powers it has,' said Loren McDonald, an analyst for the EV data consultancy Paren.
It's Friday — thank you for tuning in to POLITICO's Power Switch. I'm your host, David Ferris. Power Switch is brought to you by the journalists behind E&E News and POLITICO Energy. Send your tips, comments, questions to [e-mail].
Programming note: We'll be off this Monday but will be back in your inboxes on Tuesday, May 27.
Today in POLITICO Energy's podcast: James Bikales and Kelsey Tamborrino break down the energy portions of the House Republicans' megabill.
Power Centers
EPA's 'gold bars' quest gets complicatedThe Environmental Protection Agency's bid to claw back billions in climate finance grants is facing internal contradictions as it continues, Jean Chemnick writes.
Administrator Lee Zeldin claimed again this week that the funds are being withheld because of fraud and misconduct. Meanwhile, Justice Department lawyers defending EPA's move have downplayed any malfeasance in court.
'To be clear, we're not accusing anybody of fraud,' Yaakov Roth, an acting assistant attorney general, told a U.S. Court of Appeals panel in D.C. in a Monday hearing. 'I don't want to suggest otherwise.'
Climate advocates regroup for Senate fightClimate action defenders are pinning their hopes on the Senate after moderate House Republicans who had defended renewable energy tax credits voted in favor of their chamber's budget reconciliation megabill, Kelsey Brugger and Andres Picon write.
The bill that passed Thursday took a sledgehammer to a host of green incentives included in the Democrats' 2022 Inflation Reduction Act. Some Republican senators have been skeptical of dramatic changes to the IRA.
'We're going to urge our supporters in the Senate to make significant changes to this bill,' said Frank Macchiarola, vice president of the American Clean Power Association.
Changes coming?Speaking of the Senate, Republicans can lose only three votes as some look to scale back changes to the IRA, James Bikales and Kelsey Tamborrino write.
The upper chamber is expected to moderate the version passed by the House.
'We have a lot of work that we need to do on the timeline and scope of the production and investment tax credits,' said Sen. Thom Tillis (R-N.C.). 'Undoubtedly, there's going to be changes.'
In Other News
More power: The Northwest's only nuclear plant will get $700 million in upgrades after the Bonneville Power Administration approved plans for the expansion this week.
Called to act: The late Pope Francis' call to environmental action inspired a Catholic church in Kentucky to be the first in the U.S. to announce plans to reach net-zero carbon emissions.
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White House budget director Ross Vought sounded off on the Government Accountability Office after it issued a report calling the Trump administration's 'impoundment' of federal funds for charger stations illegal.
Wisconsin regulators signed off on a utility's plan to add gas-fired power totaling $1.5 billion to supplement new demand from data centers.
EPA Administrator Lee Zeldin offered a new argument — six, technically — for why the agency should overhaul the endangerment finding that underpins its climate rules.
That's it for today, folks. Thanks for reading, and have a great long weekend!