As the U.S. Senate passes a major climate bill, what's in it for Washington state?
On Sunday, Aug. 7, the U.S. Senate passed the Inflation Reduction Act, which includes the biggest climate investment in U.S. history. Seattle-based journalist David Roberts is the host of the podcast "Volts" and writes a newsletter of the same name, all about clean energy and politics. He previously reported on the environment for the websites Vox and Grist. Roberts spoke with KUOW about the big-picture impact of the bill, and what it could mean for Washington state.
This interview has been edited for clarity.
David Roberts: We have been pursuing major climate legislation in the U.S. since the 90s, and it has been a grim march of failure after failure. It looked, just three weeks ago, like we were going to have another round of failure this time. It looked like Senator Joe Manchin was going to take his toys and go home, and there was going to be nothing. So, what we've seen in this last week is "nothing" become historically major climate legislation from the U.S., finally, which is not only going to reduce greenhouse gases, and reduce air pollution in the U.S., but is also going to signal to our international partners that we're serious about things, which is also going to help international negotiations.
Everything's such a cacophony these days. There's so much news coming at everybody. It's so hard to get the signal through the noise. But I just want to emphasize this is a major piece of legislation, a major big deal that is going to transform the U.S. energy industry.
Kim Malcolm: Let's try to break this down. I've been curious about getting an electric vehicle, but they're not cheap. Is this bill going to help me get one?
Yes. The bill has a wide range of consumer-facing tax rebates, to help consumers buy equipment that will help them decarbonize, mainly their transportation and their home. So, that's true for EVs. There's also a tax credit for used EVs, which I think is really cool. And then there are also tax credits for home insulation, for replacing your natural gas furnace with a heat pump, for heat pump water heaters, for induction stoves for upgrading your home's electrical box so that it can handle more electrification. There's a wide range of things that are going to be directly available to consumers in the coming years.
As for the EV thing, it's a little bit quirky, because one of the things Senator Joe Manchin added is a requirement that 40% of the content of the EV has to be domestically manufactured. Meaning, where did the metals come from? Where are they refined? Where are the batteries manufactured? Where are the EVS themselves manufactured? And right now, today, there are very, very few EVs that pass that requirement, because most of the supply chain is in China. One of the things we’ll see in coming years is an enormous flood of investment in domestic manufacturing of EVs and EV components. You may have to wait a year or two before they start producing EVs that are subject to the credit, but once you get one, you can take heart in the fact that it was mostly manufactured here in the U.S. using high-quality labor.
There are waiting lists out there already. Are you saying that the Pacific Northwest could see a vehicle manufacturing plant here in the next few years?
It depends. The U.S. is definitely going to see more mining of these crucial minerals, more mineral refining, and more manufacturing of batteries and EVs. Where that happens depends on more subtle domestic effects: Who's offering the biggest tax havens? Who's got the cheapest labor? I think Washington is probably less of a manufacturing destination because I think we have more expertise in the innovation and research aspects of these things, which also get money in this bill.
So, I'm not sure if we're going to become a manufacturing hub, but interestingly, a lot of areas of the country which are not politically super-big on Democrats right now, or super-big on clean energy right now, are going to see a flood of investment which could change not only the economics of all this but the politics of all this.
We've had wind and solar businesses active here for years, especially in the central part of the state. What are you predicting now when it comes to those kinds of businesses and the jobs that could come?
One of the interesting things about the domestic wind and solar industries in the U.S. is that they've been, in the past 20 years, through several boom-and-bust cycles, and all those cycles are connected to federal tax credits, which will get renewed for two years, and then they'll lapse, and then they'll get renewed. It's this constant uncertainty that has really slowed the industry. What this bill does is boosts tax credits for wind and solar and locks them in for 10 years. That's predictability. That's a long runway, which means we're going to see a boom in wind and solar across the U.S.
And as you say, Washington state, especially out in the central part, is very hot, very sunny, and very windy. So, there's tons more to be done there. And Washington state passed its own great climate and clean energy legislation not that many years ago, which ensures that those jobs at wind and solar plants will be high-quality union jobs. So, the flood of money, and the flood of certainty for the wind and solar industry, is going to be a huge boom all across that corridor.
Something that hasn't gotten a lot of attention in all of this is what could happen for our ports. What kinds of changes are we going to see there?
This bill is interesting in that it's not like the old cap and trade bill 10 years ago, it's just a bunch of individual items. Ports are one of many, many things where several billion dollars are granted to ports to clean up. Ports are notoriously sources of not only greenhouse gases but particulate pollution. And it's notoriously, generally, low-income and vulnerable communities that live around the ports and suffer those effects.
There's $3 billion in the bill to clean up ports. And that means, not only ships themselves, but the machines that unload the ships, the machines that drive those containers around the ports, those are going to be electrified and cleaned up. And that will be an enormous, not only reduction in pollution, but very specifically, a reduction in pollution for the most vulnerable communities.
Listen to the interview by clicking the play button above.