US Election 2024: How Policy Changes Could Transform the EV Landscape
Insights from industry experts on how the 2024 election could reshape policies like the IRA and impact the EV battery supply chain in the US.
The 2024 US presidential election is poised to be a pivotal moment for industries reliant on government policies, particularly the electric vehicle (EV) and battery sectors. As the election draws closer, the prospect of a shift in policy direction could have potential implications for the Inflation Reduction Act (IRA) and the future of domestic battery and EV manufacturing. During the Battery Show North America, a timely panel discussion titled "What If There Is a Shift in Policy Direction Next Year?" brought together industry leaders to explore the possible ramifications of the election on US energy and EV policy.
The panelists—Suzanne Swink, Vice President of Government Relations at KORE Power; James Trevey, Chief Technology Officer at Forge Nano; and Ben Steinberg, Executive Vice President and Co-Chair of the Critical Infrastructure Practice at Venn Strategies—shared their insights into how the 2024 election could impact policies like the IRA and the broader battery supply chain. They discussed everything from potential changes to tax credits to the balance between domestic and global supply chains.
The IRA legislation has stimulated significant growth in the EV and battery sectors, especially by providing incentives such as tax credits. However, a change in political leadership, especially under a Republican administration, could introduce uncertainty and significant policy shifts that affect the future of these industries. Below, we explore the potential outcomes of a policy shift and its implications.
Impact of the 2024 election on the IRA
Panelist made clear that under a second Trump administration, for instance, there might be efforts to repeal or roll back many of the tax credits and incentives established by the IRA, while increasing tariffs to promote domestic production. On the other hand, a Democratic administration, likely led by Vice President Kamala Harris, is expected to maintain and even strengthen the provisions of the IRA.
Steinberg, noted the potential shift under a Trump administration: "It will be interesting so see if Mr. Trump becomes president, will he take lessons learned and try to apply them to areas that his administration would care about, like critical minerals projects?” This indicates that a new administration could reshape the priorities of various government departments, including the Department of Energy, potentially reducing the focus on clean energy projects and reshuffling key staff. “ Usually when a new cabinet secretary comes in, they reshuffle the deck and move things around” Steinberg explained.
From left to right: John Warner, Chief Customer Officer at American Battery Solutions - Lake Orion, MI; Ben Steinberg, Executive Vice President and Co-Chair of the Critical Infrastructure Practice at Venn Strategies; Suzanne Swink, VP - Government Relations at KORE Power; and James Trevey, Chief Technology Officer at Forge Nano. Courtesy of Maria Guerra.
Control of Congress and its role
The panelists think that control of Congress will also play a crucial role in determining the future of the IRA. Swink emphasized the importance of the control of both houses of Congress, not just the White House, “It's not just the control of the White House that matters. It's both houses of Congress. Right? In any new administration, you tend to see a number of executive orders come out, kind of laying out policy positions and things that the President wants to see happen. We'll see some of those… whether it's building on the IRA or reeling it back, potentially, right?" she said.
Panelists expressed that if Congress remains split between Democrats and Republicans, policy shifts could be even more dramatic. A Republican majority could push for the repeal or modification of key provisions, including the 30D EV tax credit, which incentivizes EV purchases. Timing will be critical, as Congress only has one year to complete the tax bill that includes many IRA provisions.
This legislative uncertainty creates challenges for the industry, especially for companies that have invested heavily in EV and battery production based on the current policies. The control of Congress, whether split or unified under one party, could significantly impact the continuation, modification, or repeal of policies crucial for the EV battery supply chain.
According to Steinberg, a shift in policy could lead to changes in how the government supports domestic projects. He stated, "There are several bills that look to repeal it completely. There are bills that are out there that want to strip and redo the guidance around 30D.” This uncertainty has raised concerns among automakers and battery manufacturers about the future of their investments.
Trevey also emphasized the importance of policy continuity for the industry's success: "Policy changes could disrupt the supply chain economics and competitiveness that companies have built around current incentives like the IRA." A sudden policy change could undermine the progress made in building domestic battery production capacity in the US.
US EV tax credit updates. Courtersy of Kameleon007/iStock /Getty Images Plus
Industry engagement with policymakers
According to the panelists, considering the potential policy changes, the battery and EV industries will need to engage proactively with policymakers to advocate for maintaining key provisions of the IRA. Collaboration with trade associations and presenting a unified industry voice will be crucial in shaping future policies. Trevey highlighted the importance of industry expertise in policymaking: "There’s so much that the people in power don’t know…They need to know that they have informed decision-making materials."
By providing policymakers with detailed insights into the industry's challenges and opportunities, the sector can help ensure that future policies continue to support domestic production while minimizing supply chain disruptions.
Navigating uncertainty
As the 2024 presidential election approaches, the future of the US battery and EV industries hang in the balance. Whether the policies remain in place or undergo significant changes, the industry must be prepared to adapt. Maintaining bipartisan support and advocating for gradual, carefully timed implementation of domestic content requirements will be essential for ensuring the continued growth and competitiveness of the US in the global battery market. Regardless of the election outcome, collaboration between industry leaders and policymakers will be key to navigating the challenges ahead.
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