In 2024, billions of dollars will flow to electric vehicle infrastructure. Federal agencies could shake up the energy landscape with major decisions on clean cars, electric transmission, and hydrogen.
The Inflation Reduction Act and its impacts will remain center stage. But as 2024 progresses, all eyes will be on the presidential election — and its serious climate implications.
Here’s DGA’s take on the climate and clean energy news to watch in 2024.
All Eyes on Agencies
Prospects are dim for much significant legislation in a divided Congress. Next year, though, we’re expecting several big decisions from federal agencies. Among them: The Environmental Protection Agency could finalize strict emissions rules for light-, medium-, and heavy-duty vehicles. These rules, if they’re in line with draft standards unveiled earlier this year, could spark revolutionary change in the auto industry and turbocharge EV sales.
Meanwhile, the Federal Energy Regulatory Commission (FERC) has yet to issue a long-awaited rule reforming how the U.S. plans new electric transmission lines — and more clearly defining who pays for them. The policy’s goal is to make sure grid planners (e.g. regional transmission organizations, RTOs) are planning ahead so the grid can handle more renewables, support electrification, and mitigate reliability threats from extreme weather. There’s broad support for this action — from utilities to environmental groups — and hope that FERC could move forward in the first quarter of 2024, despite two vacancies on the commission.
Next year will also bring new “green hydrogen” standards for the IRA’s production tax credits. Recently leaked information from the Treasury Department suggests these standards could be even stricter than EU’s rules. As reported in Bloomberg and Politico, the policy would mandate hourly tracking of green energy used to produce hydrogen, and would require this energy to come from sources built in the past three years. With billions in tax breaks on the table, this guidance — however it turns out — will have big implications for a still fledgling green hydrogen industry.
The Year of the EV Charger
Next year could be huge for EV charger deployment. The federal government has infused billions of dollars into EV infrastructure, but we’re just now beginning to see shovels break ground.
One of the largest large chunks of that money comes from the National Electric Vehicle Infrastructure program — a $5 billion fund established through the bipartisan infrastructure law to deploy fast chargers around the country. Each state administers its own NEVI funds, but two years after the program launched, only seven have awarded contracts. The very first NEVI-funded charger came online in Ohio just this month (as highlighted in this Politico report).
We hope to see progress accelerate next year. An additional 17 states have issued solicitations for charging providers, and others could move forward in the coming weeks.
“These are things that take a little bit of time,” said Gabe Klein, who heads the Joint Office of Energy and Transportation, in response to questions about the pace of NEVI rollout. “But boy, when you’re done, it’s going to completely change the game.”
Setting Goals vs. Meeting Goals
For several years, DGA has conducted research on corporate sustainability pledges, as well as efforts to electrify commercial fleets. We have seen more companies than ever setting goals to reduce their emissions — an indication that climate action has become something that both shareholders and customers expect.
But goal-setting is just the beginning.
According to research from the project Net Zero Tracker, half of companies on the Forbes Global 2000 have set a net-zero goal, but only 4% of those targets are sufficient to meet the U.N.’s “Race to Zero” standards. Amid concerns about greenwashing and “greenhushing,” there’s a larger spotlight than ever on gaps between some companies’ stated ambitions and the details of those plans. As we move another year closer to target dates in 2030 and 2035, DGA will continue watching how companies intend to meet their goals in the timeframes they’ve set out.
All Day, Everyday: IRA
IRA implementation was in our news-to-watch report last year, and unsurprisingly it’s back again. Since the bill became law, companies have announced more than $388 billion in large-scale renewable energy investments, with plenty more on the horizon.
Agencies have also dispensed billions for rural electric cooperatives, community resiliency, and environmental justice programs. The Treasury Department just announced it has seen “remarkable” demand for bonus wind and solar tax credits in low-income communities — more than four times what was allocated for the program in 2023.
Americans are also taking advantage of the bill’s personal tax credits for EVs, heat pumps, and other appliances. Starting in January, the EV credits will be available at point-of-sale, which administration officials hope will make electric cars more accessible. New battery sourcing rules, however, will also take effect, impacting some cars’ eligibility. Meanwhile, another home efficiency rebate program administered by the states will launch next year. This will be crucial given what advocates view as the slow pace of heat pump adoption so far. (“We’re not on track,” Alexander Gard-Murray, director of the climate think tank, Greenhouse Institute, told the New York Times in November.)
Passing the IRA — after months of political wrangling when it often seemed like Congress would achieve nothing on climate — was a huge deal. But implementing it is an equally massive undertaking that we’ll continue watching closely in 2024.
Election Year Implications
The 2024 elections will loom large next year. Congressional Republicans have tried to undermine the IRA (despite major investment it’ll bring to many of their districts). And while in office, Donald Trump — once again his party’s frontrunner — took many steps to downplay climate urgency. Among the other GOP candidates, only former New Jersey governor Chris Christie has said humans are causing climate change. And none have supported the Paris accord.
Expect clean energy advocates to push all the candidates on their positions next year and to ramp up their own messaging around the importance of U.S. leadership on climate.
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